OCTOBER TERM, 1995
Syllabus
GASPERINI
v. CENTER FOR HUMANITIES, INC.
CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE SECOND
CIRCUIT
No. 95-719. Argued April 16, 1996-Decided June 24, 1996
Under the law of New York, appellate courts are empowered to
review the size of jury verdicts and to order new trials when the
jury's award "deviates materially from what would be reasonable
compensation." N. Y. Civ. Prac. Law and Rules (CPLR) § 5501 (c).
Under the Seventh Amendment, which governs proceedings in federal
court, but not in state court, "the right of trial by jury shall be
preserved, and no fact tried by a jury, shall be otherwise
re-examined in any Court of the United States, than according to
the rules of the common law." The compatibility of these
provisions, in an action based on New York law but tried in federal
court by reason of the parties' diverse citizenship, is the issue
the Court confronts in this case.
Petitioner Gasperini, a journalist and occasional photographer,
loaned 300 original slide transparencies to respondent Center for
Humanities, Inc. When the Center lost the transparencies, Gasperini
commenced suit in the United States District Court for the Southern
District of New York, invoking the court's diversity jurisdiction.
The Center conceded liability. After a trial on damages, a jury
awarded Gasperini $1,500 per transparency, the asserted "industry
standard" of compensation for a lost transparency. Contending,
inter alia, that the verdict was excessive, the Center moved
for a new trial. The District Court, without comment, denied the
motion.
The Court of Appeals for the Second Circuit, observing that New
York law governed the controversy, endeavored to apply CPLR § 5501
(c) to evaluate the Center's contention that the verdict was
excessive. Guided by New York Appellate Division decisions
reviewing damage awards for lost transparencies, the Second Circuit
held that the $450,000 verdict "materially deviates from what is
reasonable compensation." The court vacated the judgment entered on
the jury verdict and ordered a new trial, unless Gasperini agreed
to an award of $100,000.
Held: New York's law controlling compensation awards for
excessiveness or inadequacy can be given effect, without detriment
to the Seventh Amendment, if the review standard set out in CPLR §
5501(c) is applied by the federal trial court judge, with appellate
control of the trial court's ruling confined to "abuse of
discretion." Pp. 422-439.
416
(a) To heighten the judicial check on the size of jury awards,
New York codified the "deviates materially" standard of review,
replacing the judge-made "shock the conscience" formulation
previously used in New York courts. In design and operation, §
5501(c) influences outcomes by tightening the range of tolerable
awards. Although phrased as a direction to New York's intermediate
appellate courts, § 5501 (c)'s "deviates materially" standard, as
construed by New York's courts, instructs state trial judges as
well. Pp. 422-425.
(b) In cases like Gasperini's, in which New York law governs the
claims for relief, the Court must determine whether New York law
also supplies the test for federal-court review of the size of the
verdict. Federal diversity jurisdiction provides an alternative
forum for the adjudication of state-created rights, but it does not
carry with it generation of rules of substantive law. Under the
doctrine of
Erie R. Co. v.
Tompkins, 304 U. S. 64, federal
courts sitting in diversity apply state substantive law and federal
procedural law. Classification of a law as "substantive" or
"procedural" for
Erie purposes is sometimes a challenging
endeavor.
Guaranty Trust Co. v.
York, 326 U. S. 99, an early
interpretation of
Erie, propounded an
"outcome-determination" test: "[D]oes it significantly affect the
result of a litigation for a federal court to disregard a law of a
State that would be controlling in an action upon the same claim by
the same parties in a State court?" 326 U. S., at 109. A later
pathmarking case, qualifying
Guaranty Trust, explained that
the "outcome-determination" test must not be applied mechanically
to sweep in all manner of variations; instead, its application must
be guided by "the twin aims of the
Erie rule: discouragement
of forum-shopping and avoidance of inequitable administration of
the laws."
Hanna v.
Plumer, 380 U. S. 460, 468.
Informed by these decisions, the Court concludes that, although
§ 5501(c) contains a procedural instruction assigning
decisionmaking authority to the New York Appellate Division, the
State's objective is manifestly substantive. More rigorous
comparative evaluations attend application of § 5501(c)'s "deviates
materially" standard than the common-law "shock the conscience"
test. If federal courts ignore the change in the New York standard
and persist in applying the "shock the conscience" test to damage
awards on claims governed by New York law, "'substantial'
variations between state and federal [money judgments]" may be
expected. See
id., at 467-468. The Court therefore agrees
with the Second Circuit that New York's check on excessive damages
warrants application in federal court, for
Erie's doctrine
precludes a recovery in federal court significantly larger than the
recovery that would have been tolerated in state court. Pp.
426-431.
417
(c) Nonetheless, when the Second Circuit used § 5501(c) as the
standard for federal appellate review, it did not attend to "[a]n
essential characteristic of [the federal court] system."
Byrd v.
Blue Ridge Rural Elec. Cooperative, Inc.,
356 U. S. 525,
537. The Seventh Amendment, which governs proceedings in federal
court, but not in state court, bears not only on the allocation of
trial functions between judge and jury, the issue in
Byrd;
it also controls the allocation of authority to review verdicts,
the issue of concern here. In keeping with the historic
understanding, the Seventh Amendment's Reexamination Clause does
not inhibit the authority of trial judges to grant new trials "for
any of the reasons for which new trials have heretofore been
granted in actions at law in the courts of the United States." Fed.
Rule Civ. Proc. 59(a). In contrast, appellate review of a federal
trial court's denial of a motion to set aside a jury's verdict as
excessive is a relatively late, and less secure, development. Such
review, once deemed inconsonant with the Seventh Amendment's
Reexamination Clause, has not been expressly approved by this Court
before today. See,
e. g., Browning-Ferris Industries of Vt.,
Inc. v.
Kelco Disposal, Inc., 492 U. S. 257,279, n. 25.
Circuit decisions unanimously recognize, however, that appellate
review, confined to abuse of discretion, is reconcilable with the
Seventh Amendment as a control necessary and proper to the fair
administration of justice. The Court now approves this line of
decisions. Pp.431-436.
(d) In this case, the principal state and federal interests can
be accommodated. New York's dominant interest in having its
substantive law guide the allowable damages arising out of a
state-law claim for relief can be respected, without disrupting the
federal system, once it is recognized that the federal district
court is capable of applying the State's "deviates materially"
standard. The Court recalls, in this regard, that the "deviates
materially" standard serves as the guide to be applied in trial as
well as appellate courts in New York. Within the federal system,
practical reasons combine with Seventh Amendment constraints to
lodge in the district court, not the court of appeals, primary
responsibility for application of § 5501 (c)'s check. District
court applications of the "deviates materially" standard would be
subject to appellate review under the standard the Circuits now
employ when inadequacy or excessiveness is asserted on appeal:
abuse of discretion. Pp. 436-439.
(e) It does not appear that the District Court checked the
jury's verdict against the relevant New York decisions.
Accordingly, the Court vacates the judgment of the Court of Appeals
and instructs that court to remand the case to the District Court
so that the trial judge, revisiting his ruling on the new trial
motion, may test the jury's verdict against CPLR § 5501 (c)'s
"deviates materially" standard. P. 439.
66 F.3d
427, vacated and remanded.
418
GINSBURG, J., delivered the opinion of the Court, in which
O'CONNOR, KENNEDY, SOUTER, and BREYER, JJ., joined. STEVENS, J.,
filed a dissenting opinion,
post, p. 439. SCALIA, J., filed
a dissenting opinion, in which REHNQUIST, C. J., and THOMAS, J.,
joined,
post, p. 448.
Samuel A. Abady argued the cause for petitioner. With him on the
briefs were Jonathan S. Abady, Matthew D. Brinckerhoff, and Andrew
Dwyer.
Theodore B. Olson argued the cause for respondent.
With him on the brief were Theodore
J. Boutrous, Jr.,
Douglas R. Cox, Mark Snyderman, and Francis A. Montbach.*
JUSTICE GINSBURG delivered the opinion of the Court. Under the
law of New York, appellate courts are empowered to review the size
of jury verdicts and to order new trials when the jury's award
"deviates materially from what would be reasonable compensation."
N. Y. Civ. Prac. Law and Rules (CPLR) § 5501(c) (McKinney 1995).
Under the Seventh Amendment, which governs proceedings in federal
court, but not in state court, "the right of trial by jury shall be
preserved, and no fact tried by a jury, shall be otherwise
re-examined in any Court of the United States, than according to
the rules of the common law." U. S. Const., Arndt. 7.
*Briefs of
amici curiae urging reversal were filed for
the Association of Trial Lawyers of America by
Jeffrey Robert
White and
Pamela A. Liapakis; for the Picture Agency
Council of America, Inc. (PACA), by
Nancy E. Wolff; and for
Federal Jurisdiction and Legal History Scholars Akhil Reed Amar et
al. by
Arthur F.
McEvoy pro se, Arthur R. Miller pro se,
Daniel R. Coquillette pro se, Kenneth J. Chesebro,
Arthur H. Bryant, William A. Rossbach, and
Jonathan S.
Massey.
Briefs of amici curiae urging affirmance were filed for the City
of New York by Paul A. Crotty, Leonard
J. Koerner, and
Elizabeth S. Natrella; for the American Council of Life Insurance
et al. by Patricia A. Dunn, Stephen
J. Goodman, Phillip E.
Stano, and Craig Berrington; for the Chamber of Commerce of the
United States et al. by W DeVier Pierson, Mark E. Greenwold,
Clinton E. Cameron, Stephen A. Bokat, and Robin S. Conrad; and for
the Products Liability Advisory Council, Inc., by Michael Hoenig
and David B. Hamm.
419
The compatibility of these provisions, in an action based on New
York law but tried in federal court by reason of the parties'
diverse citizenship, is the issue we confront in this case. We hold
that New York's law controlling compensation awards for
excessiveness or inadequacy can be given effect, without detriment
to the Seventh Amendment, if the review standard set out in CPLR §
5501(c) is applied by the federal trial court judge, with appellate
control of the trial court's ruling limited to review for "abuse of
discretion."
I
Petitioner William Gasperini, a journalist for CBS News and the
Christian Science Monitor, began reporting on events in Central
America in 1984. He earned his living primarily in radio and print
media and only occasionally sold his photographic work. During the
course of his seven-year stint in Central America, Gasperini took
over 5,000 slide transparencies, depicting active war zones,
political leaders, and scenes from daily life. In 1990, Gasperini
agreed to supply his original color transparencies to The Center
for Humanities, Inc. (Center) for use in an educational videotape,
Conflict in Central America. Gasperini selected 300 of his slides
for the Center; its videotape included 110 of them. The Center
agreed to return the original transparencies, but upon the
completion of the project, it could not find them.
Gasperini commenced suit in the United States District Court for
the Southern District of New York, invoking the court's diversity
jurisdiction pursuant to 28 U. S. C. § 1332.1 He alleged several
state-law claims for relief, including breach of contract,
conversion, and negligence. See App. 5-6. The Center conceded
liability for the lost transparencies and the issue of damages was
tried before a jury.
1 Plaintiff Gasperini, petitioner here, is a citizen of
California; defendant Center, respondent here, is incorporated, and
has its principal place of business, in New York.
420
At trial, Gasperini's expert witness testified that the
"industry standard" within the photographic publishing community
valued a lost transparency at $1,500. See
id., at 227. This
industry standard, the expert explained, represented the average
license fee a commercial photograph could earn over the full course
of the photographer's copyright, i.
e., in Gasperini's case,
his lifetime plus 50 years. See
id., at 228; see also 17 U.
S. C. § 302(a). Gasperini estimated that his earnings from
photography totaled just over $10,000 for the period from 1984
through 1993. He also testified that he intended to produce a book
containing his best photographs from Central America. See App.
175.
After a three-day trial, the jury awarded Gasperini $450,000 in
compensatory damages. This sum, the jury foreperson announced, "is
[$]1500 each, for 300 slides."
Id., at 313. Moving for a new
trial under Federal Rule of Civil Procedure 59, the Center attacked
the verdict on various grounds, including excessiveness. Without
comment, the District Court denied the motion. See App. to Pet. for
Cert.12a.
The Court of Appeals for the Second Circuit vacated the judgment
entered on the jury's verdict.
66 F.3d
427 (1995). Mindful that New York law governed the controversy,
the Court of Appeals endeavored to apply CPLR § 5501(c), which
instructs that, when a jury returns an itemized verdict, as the
jury did in this case, the New York Appellate Division "shall
determine that an award is excessive or inadequate if it deviates
materially from what would be reasonable compensation." The Second
Circuit's application of § 5501(c) as a check on the size of the
jury's verdict followed Circuit precedent elaborated two weeks
earlier in
Consorti v.
Armstrong World Industries,
Inc., 64 F.3d
781, superseded,
72 F.3d
1003 (1995). Surveying Appellate Division decisions that
reviewed damage awards for lost transparencies, the Second Circuit
concluded that testimony on industry standard alone was
insufficient to justify a verdict; prime among other fac-
421
tors warranting consideration were the uniqueness of the slides'
subject matter and the photographer's earning leveI.2
Guided by Appellate Division rulings, the Second Circuit held
that the $450,000 verdict "materially deviates from what is
reasonable compensation." 66 F. 3d, at 431. Some of Gasperini's
transparencies, the Second Circuit recognized, were unique, notably
those capturing combat situations in which Gasperini was the only
photographer present.
Id., at 429. But others "depicted
either generic scenes or events at which other professional
photojournalists were present."
Id., at 431. No more than 50
slides merited a $1,500 award, the court concluded, after "[g]iving
Gasperini every benefit of the doubt."
Ibid. Absent evidence
showing significant earnings from photographic endeavors or
concrete plans to publish a book, the court further determined, any
damage award above $100 each for the remaining slides would be
excessive. Remittiturs "presen[t] difficult problems for appellate
courts," the Second Circuit acknowledged, for court of appeals
judges review the evidence from "a cold paper record."
Ibid.
Nevertheless, the Second Circuit set aside the $450,000 verdict and
ordered a new trial, unless Gasperini agreed to an award of
$100,000.
2 See Blackman v. Michael Friedman Publishing Group, Inc., 201
App.
Div. 2d 328, 328-329, 607 N. Y. S. 2d 43, 44 (1st Dept. 1994)
(award reduced from $1,000 to $400 per transparency in the absence
of evidence to establish uniqueness);
Nierenberg v.
Wursteria, Inc., 189 App. Div. 2d 571, 571572,592 N. Y. S.
2d 27, 27-28 (1st Dept. 1993) (award reduced from $1,500 to $500
per slide because evidence showed photographer earned little from
slide sales);
Alen MacWeeney, Inc. v.
Esquire
Assocs., 176 App. Div. 2d 217, 218; 574 N. Y. S. 2d 340, 341
(1st Dept. 1991) (award reduced from $1,500 to $159 per
transparency because evidence indicated that images were generic;
court distinguished prior ruling in
Girard Studio Group,
Ltd. v.
Young &
Rubicam, Inc., 147 App. Div.
2d 357,536 N. Y. S. 2d 790 (1st Dept. 1989), permitting an award
reduced from $3,000 to $1,500 per slide where evidence showed that
"the lost slides represented classics from a long career").
422
This case presents an important question regarding the standard
a federal court uses to measure the alleged excessiveness of a
jury's verdict in an action for damages based on state law. We
therefore granted certiorari. 516 U. S. 1086 (1996).
II
Before 1986, state and federal courts in New York generally
invoked the same judge-made formulation in responding to
excessiveness attacks on jury verdicts: courts would not disturb an
award unless the amount was so exorbitant that it "shocked the
conscience of the court." See
Consorti, 72 F. 3d, at
1012-1013 (collecting cases). As described by the Second
Circuit:
"The standard for determining excessiveness and the
appropriateness of remittitur in New York is somewhat ambiguous.
Prior to 1986, New York law employed the same standard as the
federal courts, see Matthews v. CTI Container Transport
Int'l Inc., 871 F.2d
270, 278 (2d Cir. 1989), which authorized remittitur only if
the jury's verdict was so excessive that it 'shocked the conscience
of the court.'" Id., at 1012.
See also D. Siegel, Practice Commentaries C5501:10, reprinted in
7B McKinney's Consolidated Laws of New York Ann., p. 25 (1995)
("conventional standard for altering the verdict was that its sum
was so great or so small that it 'shocked the conscience' of the
court").
In both state and federal courts, trial judges made the
excessiveness assessment in the first instance, and appellate
judges ordinarily deferred to the trial court's judgment. See,
e. g., McAllister v.
Adam Packing Corp., 66 App. Div.
2d 975, 976, 412 N. Y. S. 2d 50, 52 (3d Dept. 1978) ("The trial
court's determination as to the adequacy of the jury verdict will
only be disturbed by an appellate court where it can be said that
the trial court's exercise of discretion was not reasonably
grounded.");
Martell v.
Boardwalk Enterprises,
423
Inc., 748 F.2d
740, 750 (CA2 1984) ("The trial court's refusal to set aside or
reduce a jury award will be overturned only for abuse of
discretion.").
In 1986, as part of a series of tort reform measures,3 N ew York
codified a standard for judicial review of the size of jury awards.
Placed in CPLR § 5501(c), the prescription reads:
"In reviewing a money judgment ... in which it is contended that
the award is excessive or inadequate and that a new trial should
have been granted unless a stipulation is entered to a different
award, the appellate division shall determine that an award is
excessive or inadequate if it deviates materially from what would
be reasonable compensation." 4
As stated in Legislative Findings and Declarations accompanying
New York's adoption of the "deviates materially" formulation, the
lawmakers found the "shock the conscience" test an insufficient
check on damage awards; the legislature therefore installed a
standard "invit[ing] more careful appellate scrutiny." Ch. 266,
1986 N. Y. Laws 470 (McKinney). At the same time, the legislature
instructed the Appellate Division, in amended § 5522, to state the
reasons for the court's rulings on the size of verdicts, and the
factors the
3 The legislature sought, particularly, to curtail medical and
dental malpractice, and to contain "already high malpractice
premiums." Legislative Findings and Declaration, Ch. 266, 1986 N.
Y. Laws 470 (McKinney). 4 In full, CPLR § 5501 (c) provides:
"The appellate division shall review questions of law and
questions of fact on an appeal from a judgment or order of a court
of original instance and on an appeal from an order of the supreme
court, a county court or an appellate term determining an appeal.
In reviewing a money judgment in an action in which an itemized
verdict is required by rule fortyone hundred eleven of this chapter
in which it is contended that the award is excessive or inadequate
and that a new trial should have been granted unless a stipulation
is entered to a different award, the appellate division shall
determine that an award is excessive or inadequate if it deviates
materially from what would be reasonable compensation."
424
court considered in complying with §5501(c).5 In his signing
statement, then-Governor Mario Cuomo emphasized that the CPLR
amendments were meant to rachet up the review standard: "This will
assure greater scrutiny of the amount of verdicts and promote
greater stability in the tort system and greater fairness for
similarly situated defendants throughout the State." Memorandum on
Approving L. 1986, Ch. 682,1986 N. Y. Laws, at 3184; see also
Newman & Ahmuty, Appellate Review of Punitive Damage Awards, in
Insurance, Excess, and Reinsurance Coverage Disputes 1990, p. 409
(B. Ostrager & T. Newman eds. 1990) (review standard prescribed
in § 5501(c) "was intended to ... encourage Appellate Division
modification of excessive awards").
New York state-court opinions confirm that § 5501(c)'s "deviates
materially" standard calls for closer surveillance than "shock the
conscience" oversight. See,
e. g., O'Connor v.
Graziosi, 131 App. Div. 2d 553, 554, 516 N. Y. S. 2d 276,
277 (2d Dept. 1987) ("apparent intent" of 1986 legislation was "to
facilitate appellate changes in verdicts");
Harvey v.
Mazal American Partners, 79 N. Y. 2d 218, 225, 590 N. E. 2d
224, 228 (1992) (instructing Appellate Division to use, in setting
remittitur, only the "deviates materially" standard, and not the
"shock the conscience" test); see also
Consorti, 72 F. 3d,
at 1013 ("Material deviation from reasonableness is less than that
deviation required to find an award so excessive as to 'shock the
conscience.' "); 7 J. Weinstein, H. Korn, & A. Miller, New York
Civil Practice' 5501.21, p. 55-64 (1995) ("Under [§ 5501(c)'s] new
standard, the reviewing court is given greater power to review the
size of a jury award than had heretofore been afforded .... ").
5 CPLR § 5522(b) provides:
"In an appeal from a money judgment in an action ... in which it
is contended that the award is excessive or inadequate, the
appellate division shall set forth in its decision the reasons
therefor, including the factors it considered in complying with
subdivision (c) of section fifty-five hundred one of this
chapter."
425
Although phrased as a direction to New York's intermediate
appellate courts, § 5501(c)'s "deviates materially" standard, as
construed by New York's courts, instructs state trial judges as
well. See,
e. g., Inya v.
Ide Hyundai, Inc., 209 App.
Div. 2d 1015, 619 N. Y. S. 2d 440 (4th Dept. 1994) (error for trial
court to apply "shock the conscience" test to motion to set aside
damages; proper standard is whether award "materially deviates from
what would be reasonable compensation");
Cochetti v.
Gralow, 192 App. Div. 2d 974, 975, 597 N. Y. S. 2d 234, 235
(3d Dept. 1993) ("settled law" that trial courts conduct
"materially deviates" inquiry);
Shurgan v.
Tedesco,
179 App. Div. 2d 805, 806, 578 N. Y. S. 2d 658, 659 (2d Dept. 1992)
(approving trial court's application of "materially deviates"
standard); see also
Lightfoot v.
Union Carbide Corp.,
901 F. Supp. 166, 169 (SDNY 1995) (CPLR 5501(c)'s "materially
deviates" standard "is pretty well established as applicable to
[state] trial and appellate courts."). Application of § 5501(c) at
the trial level is key to this case.
To determine whether an award "deviates materially from what
would be reasonable compensation," New York state courts look to
awards approved in similar cases. See,
e. g.,
Leon v.
J &
M Peppe Realty Corp., 190 App.
Div. 2d 400, 416, 596 N. Y. S. 2d 380, 389 (1st Dept. 1993) ("These
awards ... are not out of line with recent awards sustained by
appellate courts.");
Johnston v.
Joyce, 192 App. Div.
2d 1124, 1125, 596 N. Y. S. 2d 625, 626 (4th Dept. 1993) (reducing
award to maximum amount previously allowed for similar type of
harm). Under New York's former "shock the conscience" test, courts
also referred to analogous cases. See,
e. g.,
Senko v.
Fonda, 53 App. Div. 2d 638, 639, 384 N. Y.
S. 2d 849, 851 (2d Dept. 1976). The "deviates materially" standard,
however, in design and operation, influences outcomes by tightening
the range of tolerable awards. See,
e. g.,
Consorti, 72 F. 3d, at 1013, and n. 10, 1014-1015, and
n.14.
426
III
In cases like Gasperini's, in which New York law governs the
claims for relief, does New York law also supply the test for
federal-court review of the size of the verdict? The Center answers
yes. The "deviates materially" standard, it argues, is a
substantive standard that must be applied by federal appellate
courts in diversity cases. The Second Circuit agreed. See 66 F. 3d,
at 430; see also
Consorti, 72 F. 3d, at 1011 ("[CPLR §
5501(c)] is the substantive rule provided by New York law.").
Gasperini, emphasizing that § 5501(c) trains on the New York
Appellate Division, characterizes the provision as procedural, an
allocation of decisionmaking authority regarding damages, not a
hard cap on the amount recoverable. Correctly comprehended,
Gasperini urges, § 5501(c)'s direction to the Appellate Division
cannot be given effect by federal appellate courts without
violating the Seventh Amendment's Reexamination Clause.
As the parties' arguments suggest, CPLR § 5501(c), appraised
under
Erie R. Co. v.
Tompkins, 304 U. S. 64 (1938), and
decisions in
Erie's path, is both "substantive" and
"procedural": "substantive" in that § 5501(c)'s "deviates
materially" standard controls how much a plaintiff can be awarded;
"procedural" in that § 5501(c) assigns decisionmaking authority to
New York's Appellate Division. Parallel application of § 5501(c) at
the federal appellate level would be out of sync with the federal
system's division of trial and appellate court functions, an
allocation weighted by the Seventh Amendment. The dispositive
question, therefore, is whether federal courts can give effect to
the substantive thrust of § 5501(c) without untoward alteration of
the federal scheme for the trial and decision of civil cases.
A
Federal diversity jurisdiction provides an alternative forum for
the adjudication of state-created rights, but it does not carry
with it generation of rules of substantive law. As
427
Erie read the Rules of Decision Act: 6 "Except in matters
governed by the Federal Constitution or by Acts of Congress, the
law to be applied in any case is the law of the State." 304 U. S.,
at 78. Under the
Erie doctrine, federal courts sitting in
diversity apply state substantive law and federal procedural
law.
Classification of a law as "substantive" or "procedural" for
Erie purposes is sometimes a challenging endeavor.7
Guaranty Trust Co. v.
York, 326 U. S. 99 (1945), an
early interpretation of
Erie, propounded an
"outcomedetermination" test: "[D]oes it significantly affect the
result of a litigation for a federal court to disregard a law of a
State that would be controlling in an action upon the same claim by
the same parties in a State court?" 326 U. S., at 109. Ordering
application of a state statute of limitations to an equity
proceeding in federal court, the Court said in
Guar-
6 Originally § 34 of the Judiciary Act of 1789, the Rules of
Decision Act, now contained in 28 U. S. C. § 1652, reads: "The laws
of the several states, except where the Constitution or treaties of
the United States or Acts of Congress otherwise require or provide,
shall be regarded as rules of decision in civil actions in the
courts of the United States, in cases where they apply."
7 Concerning matters covered by the Federal Rules of Civil
Procedure, the characterization question is usually unproblematic:
It is settled that if the Rule in point is consonant with the Rules
Enabling Act, 28 U. S. C. § 2072, and the Constitution, the Federal
Rule applies regardless of contrary state law. See
Hanna v.
Plumer, 380 U.
S. 460, 469-474 (1965);
Burlington Northern R. Co. v.
Woods, 480 U. S.
1,4-5 (1987). Federal courts have interpreted the Federal
Rules, however, with sensitivity to important state interests and
regulatory policies. See,
e. g., Walker v.
Armco Steel
Corp., 446 U. S.
740, 750-752 (1980) (reaffirming decision in
Ragan v.
Merchants Transfer &
Warehouse Co., 337 U. S. 530 (1949),
that state law rather than Rule 3 determines when a diversity
action commences for the purposes of tolling the state statute of
limitations; Rule 3 makes no reference to the tolling of state
limitations, the Court observed, and accordingly found no "direct
conflict"); S.
A. Healy Co. v.
Milwaukee Metropolitan
Sewerage Dist., 60 F.3d
305, 310-312
(CA7 1995) (state provision for offers of
settlement by plaintiffs is compatible with Federal Rule 68, which
is limited to offers by defendants).
428
anty Trust: "[W]here a federal court is exercising
jurisdiction solely because of the diversity of citizenship of the
parties, the outcome of the litigation in the federal court should
be substantially the same, so far as legal rules determine the
outcome of a litigation, as it would be if tried in a State court."
Ibid.; see also
Ragan v.
Merchants Transfer
& Warehouse Co., 337 U. S. 530, 533 (1949)
(when local law that creates the cause of action qualifies it,
"federal court must follow suit," for "a different measure of the
cause of action in one court than in the other [would transgress]
the principle of
Erie"). A later pathmarking case,
qualifying
Guaranty Trust, explained that the
"outcome-determination" test must not be applied mechanically to
sweep in all manner of variations; instead, its application must be
guided by "the twin aims of the
Erie rule: discouragement of
forumshopping and avoidance of inequitable administration of the
laws."
Hanna v.
Plumer, 380 U. S. 460, 468
(1965).
Informed by these decisions, we address the question whether New
York's "deviates materially" standard, codified in CPLR § 5501(c),
is outcome affective in this sense: Would "application of the
[standard] ... have so important an effect upon the fortunes of one
or both of the litigants that failure to [apply] it would [unfairly
discriminate against citizens of the forum State, or] be likely to
cause a plaintiff to choose the federal court"?
Id., at 468,
n. 9.8
We start from a point the parties do not debate. Gasperini
acknowledges that a statutory cap on damages would supply
substantive law for
Erie purposes. See Reply Brief for
8 Hanna keyed the question to
Erie's "twin aims";
in full,
Hanna instructed federal courts to ask "whether
application of the [State's] rule would make so important a
difference to the character or result of the litigation that
failure to enforce it would unfairly discriminate against citizens
of the forum State, or whether application of the rule would have
so important an effect upon the fortunes of one or both of the
litigants that failure to enforce it would be likely to cause a
plaintiff to choose the federal court." 380 U. S., at 468, n.
9.
429
Petitioner 2 ("[T]he state as a matter of its substantive law
may, among other things, eliminate the availability of damages for
a particular claim entirely, limit the factors a jury may consider
in determining damages, or place an absolute cap on the amount of
damages available, and such substantive law would be applicable in
a federal court sitting in diversity."); see also Tr. of Oral Arg.
4-5, 25;
Consorti, 72 F. 3d, at 1011.9 Although CPLR §
5501(c) is less readily classified, it was designed to provide an
analogous control.
New York's Legislature codified in § 5501(c) a new standard, one
that requires closer court review than the commonlaw "shock the
conscience" test. See
supra, at 422-423. More rigorous
comparative evaluations attend application of § 5501(c)'s "deviates
materially" standard. See
supra, at 423-425. To foster
predictability, the legislature required the reviewing court, when
overturning a verdict under § 5501(c), to state its reasons,
including the factors it considered relevant. See CPLR § 5522(b);
supra, at 423-424. We think it a fair conclusion that CPLR §
5501(c) differs from a statutory cap principally "in that the
maximum amount recoverable is not set forth by statute, but rather
is determined by case law." Brief for City of New York as
Amicus
Curiae 11. In sum, § 5501(c) contains a procedural instruction,
see
supra, at 426, but the State's objective is manifestly
substantive. Cf. S.
A. Healy Co. v.
Milwaukee
Metropolitan Sewerage Dist., 60 F.3d
305, 310 (CA7 1995).
It thus appears that if federal courts ignore the change in the
New York standard and persist in applying the "shock
9While we have not specifically addressed the issue, courts of
appeals have held that district court application of state
statutory caps in diversity cases, postverdict, does not violate
the Seventh Amendment. See
Davis v.
Omitowoju,
883 F.2d
1155, 1161-1165
(CA3 1989) (Reexamination Clause of
Seventh Amendment does not impede federal court's post verdict
application of statutory cap);
Boyd v.
Bulala,
877 F.2d
1191, 1196
(CA4 1989) (postverdict application of
statutory cap does not violate Seventh Amendment right of trial by
jury).
430
the conscience" test to damage awards on claims governed by New
York law,lO "'substantial' variations between state and federal
[money judgments]" may be expected. See
Hanna, 380 U. S., at
467-468.11 We therefore agree with the Second Circuit that
New York's check on excessive damages implicates what we have
called
Erie's "twin aims." See
supra, at 428.12 Just
as the
Erie principle precludes a federal court from giving
a state-created claim "longer life ... than [the claim] would have
had in the state court,"
Ragan,
10 JUSTICE SCALIA questions whether federal
district
courts in New York "actually appl[y]" or
"ought" to apply
the "shock the conscience" test in assessing a jury's award for
excessiveness.
Post, at 465-466 (collecting various
formulations of review standard). If there is a federal district
court standard, it must come from the Court of Appeals, not from
the over 40 district court judges in the Southern District of New
York, each of whom sits alone and renders decisions not binding on
the others. Indeed, in
Ismail v.
Cohen, 899 F.2d
183 (1990), the authority upon which JUSTICE SCALIA relies, the
Second Circuit stated that district courts test damage awards for
excessiveness under the "shock the conscience" standard. See
id., at 186 ("A remittitur, in effect, is a statement by the
court that it is shocked by the jury's award of damages. "); see
also
Scala v.
Moore M cCormack Lines, Inc., 985 F.2d
680, 683
(CA2 1993) ("[I]n the federal courts, a
judgment cannot stand where the damages awarded are so excessive as
to shock the judicial conscience.") (internal quotation marks and
citation omitted).
llJUSTICE SCALIA questions whether application of CPLR §
5501(c), in lieu of the standard generally used by federal courts
within the Second Circuit, see
supra, at 422, will in fact
yield consistent outcome differentials, see
post, at 465,
466. The numbers, as the Second Circuit believed, are revealing.
See
66 F.3d
427, 430 (1995). Is the difference between an award of $450,000
and $100,000, see
supra, at 421, or between $1,500 per
transparency and $500, see
supra, at 421, n. 2, fairly
described as insubstantial? We do not see how that can be so.
12 For rights that are state created, state law governs the
amount properly awarded as punitive damages, subject to an ultimate
federal constitutional check for exorbitancy. See
BMW of North
America, Inc. v.
Gore, 517 U. S. 559, 568
(1996);
Browning-Ferris Industries of Vt., Inc. v.
Kelco
Disposal, Inc., 492 U. S. 257, 278-279
(1989). An evenhanded approach would require federal-court
deference to endeavors like New York's to control compensatory
damages for excessiveness. See
infra, at 435, n. 18.
431
337 U. S., at 533-534, so
Erie precludes a recovery in
federal court significantly larger than the recovery that would
have been tolerated in state court.
B
CPLR § 5501(c), as earlier noted, see
supra, at 425, 426,
is phrased as a direction to the New York Appellate Division.
Acting essentially as a surrogate for a New York appellate forum,
the Court of Appeals reviewed Gasperini's award to determine if it
"deviate[d] materially" from damage awards the Appellate Division
permitted in similar circumstances. The Court of Appeals performed
this task without benefit of an opinion from the District Court,
which had denied "without comment" the Center's Rule 59 motion. 66
F. 3d, at 428. Concentrating on the authority § 5501(c) gives to
the Appellate Division, Gasperini urges that the provision shifts
factfinding responsibility from the jury and the trial judge to the
appellate court. Assigning such responsibility to an appellate
court, he maintains, is incompatible with the Seventh Amendment's
Reexamination Clause, and therefore, Gasperini concludes, § 5501(c)
cannot be given effect in federal court. Brief for Petitioner
19-20. Although we reach a different conclusion than Gasperini, we
agree that the Second Circuit did not attend to "[a]n essential
characteristic of [the federal court] system,"
Byrd v.
Blue Ridge Rural Elec. Cooperative, Inc., 356 U. S. 525, 537
(1958), when it used § 5501(c) as "the standard for [federal]
appellate review,"
Consorti, 72 F. 3d, at 1013; see also 66
F. 3d, at 430.
That "essential characteristic" was described in
Byrd, a
diversity suit for negligence in which a pivotal issue of fact
would have been tried by a judge were the case in state court. The
Byrd Court held that, despite the state practice,13 the
plaintiff was entitled to a jury trial in federal court.
13 The defendant argued in
Byrd that although the
personal injury plaintiff was employed by an independent
contractor, the work plaintiff was engaged to perform was the same
as work done by defendant's own em-
432
In so ruling, the Court said that the
Guaranty Trust
"outcome-determination" test was an insufficient guide in cases
presenting countervailing federal interests. See
Byrd, 356
U. S., at 537. The Court described the countervailing federal
interests present in
Byrd this way:
"The federal system is an independent system for administering
justice to litigants who properly invoke its jurisdiction. An
essential characteristic of that system is the manner in which, in
civil common-law actions, it distributes trial functions between
judge and jury and, under the influence-if not the command-of the
Seventh Amendment, assigns the decisions of disputed questions of
fact to the jury." Ibid. (footnote omitted).
The Seventh Amendment, which governs proceedings in federal
court, but not in state court,14 bears not only on the allocation
of trial functions between judge and jury, the issue in
Byrd; it also controls the allocation of authority to review
verdicts, the issue of concern here. The Amendment reads:
"In Suits at common law, where the value in controversy shall
exceed twenty dollars, the right of trial by jury shall be
preserved, and no fact tried by a jury, shall be otherwise
re-examined in any Court of the United States, than according to
the rules of the common law." U. S. Const., Arndt. 7.
Byrd involved the first Clause of the Amendment, the
"trial by jury" Clause. This case involves the second, the
"re-examination" Clause. In keeping with the historic un-
ployees. Therefore, defendant maintained, the plaintiff ranked
as a "statutory employee" whose sole remedy was under the State's
workers' compensation law. The sameness of the work plaintiff and
defendant's own employees performed presented a fact question, but
in state court, a jury trial would not have been available to
resolve it.
14 See
Walker v.
Sauvinet, 92 U. S. 90, 92 (1876).
433
derstanding,15 the Reexamination Clause does not inhibit the
authority of trial judges to grant new trials "for any of the
reasons for which new trials have heretofore been granted in
actions at law in the courts of the United States." Fed. Rule Civ.
Proc. 59(a). That authority is large. See 6A Moore's Federal
Practice , 59.05[2], pp. 59-44 to 59-46 (2d ed. 1996) ("The power
of the English common law trial courts to grant a new trial for a
variety of reasons with a view to the attainment of justice was
well established prior to the establishment of our Government.");
see also
Aetna Casualty &
Surety Co. v.
Yeatts, 122 F.2d 350, 353 (CA4 1941) ("The exercise of [the
trial court's power to set aside the jury's verdict and grant a new
trial] is not in derogation of the right of trial by jury but is
one of the historic safeguards of that right.");
Blunt v.
Little, 3 F. Cas. 760, 761-762 (No. 1,578) (CC Mass. 1822)
(Story, J.) ("[I]f it should clearly appear that the jury have
committed a gross error, or have acted from improper motives, or
have given damages excessive in relation to the person or the
injury, it is as much the duty of the court to interfere, to
prevent the wrong, as in any other case."). "The trial judge in the
federal system," we have reaffirmed, "has ... discretion to grant a
new trial if the verdict appears to [the judge] to be against the
weight of the evidence."
Byrd, 356 U. S., at 540. This
discretion includes overturning verdicts for excessiveness and
ordering a new trial without qualification, or conditioned on the
verdict winner's refusal to agree to a reduction (remittitur). See
Dimick v.
Schiedt, 293 U. S. 474, 486-487
(1935) (recognizing that remittitur withstands Seventh Amendment
attack, but rejecting additur as unconstitutional).16
15 See 6A Moore's Federal Practice' 59.05[1], pp. 59-38 to 59-40
(2d ed. 1996) (common-law origin of trial court power to grant or
deny a new trial).
16 Inviting rethinking of the additur question on a later day,
Justice Stone, joined by Chief Justice Hughes and Justices Brandeis
and Cardozo, found nothing in the history or language of the
Seventh Amendment forc-
434
In contrast, appellate review of a federal trial court's denial
of a motion to set aside a jury's verdict as excessive is a
relatively late, and less secure, development. Such review was once
deemed inconsonant with the Seventh Amendment's Reexamination
Clause. See,
e. g., Lincoln v.
Power, 151 U. S. 436, 437-438
(1894);
Williamson v.
Osenton, 220
F.6d 3, 655 (CA4 1915); see also 6A Moore's Federal Practice ,
59.08[6], at 59-167 (collecting cases). We subsequently recognized
that, even in cases in which the
Erie doctrine was not in
play-cases arising wholly under federal lawthe question was not
settled; we twice granted certiorari to decide the unsettled issue,
but ultimately resolved the cases on other grounds. See
Grunenthal v.
Long Island R. Co., 393 U. S. 156, 158
(1968);
Neese v.
Southern R. Co., 350 U. S. 77
(1955).17
Before today, we have not "expressly [held] that the Seventh
Amendment allows appellate review of a district court's denial of a
motion to set aside an award as excessive."
Browning-Ferris
Industries of Vt., Inc. v.
Kelco Disposal, Inc.,
492 U. S. 257,
279, n. 25 (1989). But in successive reminders that the question
was worthy of this Court's attention, we noted, without
disapproval, that courts of appeals engage in review of district
court excessiveness determina-
ing the "incongruous position" that "a federal trial court may
deny a motion for a new trial where the plaintiff consents to
decrease the judgment to a proper amount," but may not condition
denial of the motion on "the defendant's consent to a comparable
increase in the recovery."
Dimick v.
Schiedt, 293 U.
S., at 495.
17Dissenting from the Court's professed refusal to answer the
question presented in
Grunenthal v.
Long Island R.
Co., Justices Harlan and Stewart observed that in
Grunenthal itself, this Court indeed had reviewed the
refusal of the District Court to set aside a jury verdict for
excessiveness. 393 U. S., at 163 (Harlan, J., dissenting);
id., at 164-165 (Stewart, J., dissenting). Justice Harlan
commented: "Like my Brother STEWART, I am at an utter loss to
understand how the Court manages to review the District Court's
decision and find it proper while at the same time proclaiming that
it has avoided decision of the issue whether appellate courts ever
may review such actions."
Id., at 163.
435
tions, applying "abuse of discretion" as their standard. See
Grunenthal, 393 U. S., at 159. We noted the Circuit
decisions in point,
id., at 157, n. 3, and, in
Browning-Ferris, we again referred to appellate court
abuse-of-discretion review:
"[T]he role of the district court is to determine whether the
jury's verdict is within the confines set by state law, and to
determine, by reference to federal standards developed under Rule
59, whether a new trial or remittitur should be ordered. The court
of appeals should then review the district court's determination
under an abuse-of-discretion standard." 492 U. S., at 279.18
As the Second Circuit explained, appellate review for abuse of
discretion is reconcilable with the Seventh Amendment as a control
necessary and proper to the fair administration of justice: "We
must give the benefit of every doubt to the judgment of the trial
judge; but surely there must be an upper limit, and whether that
has been surpassed is not a question of fact with respect to which
reasonable men may differ, but a question of law."
Dagnello
v.
Long Island R. Co., 289 F.2d
797, 806 (CA2 1961) (quoted in
Grunenthal, 393 U. S., at
159). All other Circuits agree. See,
e. g., Holmes v.
Elgin, Joliet &
Eastern R. Co., 18 F.3d
1393, 1396 (CA7 1994); 11 C. Wright, A. Miller, & M. Kane,
Federal Practice and Procedure § 2820, p. 209 (2d ed. 1995)
("[E]very circuit has said that there are circumstances in which it
can reverse the denial of a new trial if the size of the verdict
seems to be too far out of line."); 6A Moore's Federal Practice
18 Browning-Ferris concerned punitive damages. We agree
with the Second Circuit, however, that "[f]or purposes of deciding
whether state or federal law is applicable, the question whether an
award of
compensatory damages exceeds what is permitted by
law is not materially different from the question whether an award
of
punitive damages exceeds what is permitted by law."
Consorti v.
Armstrong World Industries, Inc.,
72 F.3d
1003, 1012 (1995).
436
, 59.08[6], at 59-177 to 59-185 (same).19 We now approve this
line of decisions, and thus make explicit what Justice Stewart
thought implicit in our
Grunenthal disposition: "[N]othing
in the Seventh Amendment ... precludes appellate review of the
trial judge's denial of a motion to set aside [a jury verdict] as
excessive." 393 U. S., at 164 (Stewart, J., dissenting) (internal
quotation marks and footnote omitted).20
C
In
Byrd, the Court faced a one-or-the-other choice: trial
by judge as in state court, or trial by jury according to the
federal practiceP In the case before us, a choice of that
19 JUSTICE SCALIA disagrees. Ready to "destroy the uniformity of
federal practice" in this regard, cf.
post, at 467, he would
render a judgment described as "astonishing" by the very authority
upon which he relies. Compare
post, at 460, with 11 C.
Wright, A. Miller, & M. Kane, Federal Practice and Procedure §
2820, p. 212 (2d ed. 1995) ("it would be astonishing if the Court,
which has passed up three opportunities to do so, should ultimately
reject" the unanimously held view of the courts of appeals).
20 If the meaning of the Seventh Amendment were fixed at 1791,
our civil juries would remain, as they unquestionably were at
common law, "twelve good men and true," 3 W. Blackstone,
Commentaries *349; see
Capital Traction Co. v.
Hof,
174 U. S. 1, 13
(1899) ('''Trial by jury,' in the primary and usual sense of the
term at the common law and in the American constitutions ... is a
trial by a jury of twelve men."). But see
Colgrove v.
Battin, 413 U.
S. 149, 160 (1973) (six-member jury for civil trials satisfies
Seventh Amendment's guarantee). Procedures we have regarded as
compatible with the Seventh Amendment, although not in conformity
with practice at common law when the Amendment was adopted, include
new trials restricted to the determination of damages,
Gasoline
Products Co. v.
Champlin Refining Co., 283 U. S. 494 (1931), and
Federal Rule of Civil Procedure 50(b)'s motion for judgment as a
matter of law, see 9A C. Wright & A. Miller, Federal Practice
and Procedure § 2522, pp. 244-246 (2d ed. 1995). See also
Park
lane Hosiery Co. v.
Shore, 439 U. S. 322, 335-337 (1979)
(issue preclusion absent mutuality of parties does not violate
Seventh Amendment, although common law as it existed in 1791
permitted issue preclusion only when there was mutuality).
21The two-trial rule posited by JUSTICE SCALIA,
post, at
467, surely would be incompatible with the existence of "[t]he
federal system [as] an independent system for administering
justice,"
Byrd v.
Blue Ridge Rural
437
order is not required, for the principal state and federal
interests can be accommodated. The Second Circuit correctly
recognized that when New York substantive law governs a claim for
relief, New York law and decisions guide the allowable damages. See
66 F. 3d, at 430; see also
Consorti, 72 F. 3d, at 1011. But
that court did not take into account the characteristic of the
federal court system that caused us to reaffirm: "The proper role
of the trial and appellate courts in the federal system in
reviewing the size of jury verdicts is ... a matter of federal
law."
Donovan v.
Penn Shipping Co., 429 U. S. 648, 649 (1977)
(per curiam); see also
Browning-Ferris, 492 U. S., at
279 ("[T]he role of the district court is to determine whether the
jury's verdict is within the confines set by state law .... The
court of appeals should then review the district court's
determination under an abuse-of-discretion standard.").
New York's dominant interest can be respected, without
disrupting the federal system, once it is recognized that the
federal district court is capable of performing the checking
function, i.
e., that court can apply the State's "deviates
materially" standard in line with New York case law evolving under
CPLR § 5501(c).22 We recall, in this regard, that the
Elec. Cooperative, Inc., 356 U. S. 525, 537
(1958). We discern no disagreement on such examples among the many
federal judges who have considered this case.
22JU8TICE SCALIA finds in Federal Rule of Civil Procedure 59 a
"federal standard" for new trial motions in "'direct collision'"
with, and" 'leaving no room for the operation of,'" a state law
like CPLR § 5501 (c).
Post, at 468 (quoting
Burlington
Northern R. Co., 480 U. S., at 4-5). The relevant prescription,
Rule 59(a), has remained unchanged since the adoption of the
Federal Rules by this Court in 1937. 302 U. S. 783. Rule 59(a) is
as encompassing as it is uncontroversial. It is indeed "Hornbook"
law that a most usual ground for a Rule 59 motion is that "the
damages are excessive." See C. Wright, Law of Federal Courts
676-677 (5th ed. 1994). Whether damages are excessive for the
claim-in-suit must be governed by
some law. And there is no
candidate for that governance other than the law that gives rise to
the claim for relief-here, the law of New York. See 28 U. S. C. §§
2072(a) and (b) ("Supreme Court shall have the power to prescribe
general rules of ... procedure"; "[s]uch rules shall not
abridge,
438
"deviates materially" standard serves as the guide to be applied
in trial as well as appellate courts in New York. See
supra,
at 425.
Within the federal system, practical reasons combine with
Seventh Amendment constraints to lodge in the district court, not
the court of appeals, primary responsibility for application of §
5501(c)'s "deviates materially" check. Trial judges have the
"unique opportunity to consider the evidence in the living
courtroom context,"
Taylor v.
Washington Terminal
Co., 409 F.2d
145, 148 (CADC 1969), while appellate judges see only the "cold
paper record," 66 F. 3d, at 431.
District court applications of the "deviates materially"
standard would be subject to appellate review under the standard
the Circuits now employ when inadequacy or excessiveness is
asserted on appeal: abuse of discretion. See 11 Wright &
Miller, Federal Practice and Procedure § 2820, at 212-214, and n.
24 (collecting cases); see 6A Moore's Federal Practice' 59.08[6],
at 59-177 to 59-185 (same). In light of
Erie's doctrine, the
federal appeals court must be guided by the damage-control standard
state law supplies,23 but as the Second Circuit itself has said:
"If we reverse, it must be because of an abuse of discretion ....
The very nature of the problem counsels restraint .... We must give
the benefit of
enlarge or modify any substantive right");
Browning-Ferris, 492 U. S., at 279 ("standard of
excessiveness" is a "matte[r] of state, and not federal, common
law"); see also R. Fallon, D. Meltzer, & D. Shapiro, Hart and
Wechsler's The Federal Courts and the Federal System 729-730 (4th
ed. 1996) (observing that Court "has continued since
[Hanna
v.
Plumer, 380 U. S. 460 (1965),] to interpret the federal
rules to avoid conflict with important state regulatory policies,"
citing
Walker v.
Armco Steel Corp., 446
23 If liability and damage-control rules are split apart here,
as JUSTICE SCALIA says they must be to save the Seventh Amendment,
then Gasperini's claim and others like it would be governed by a
most curious "law." The sphinx-like, damage-determining law he
would apply to this controversy has a state forepart, but a federal
hindquarter. The beast may not be brutish, but there is little
judgment in its creation.
439
every doubt to the judgment of the trial judge."
Dagnello, 289 F. 2d, at 806.
IV
It does not appear that the District Court checked the jury's
verdict against the relevant New York decisions demanding more than
"industry standard" testimony to support an award of the size the
jury returned in this case. As the Court of Appeals recognized, see
66 F. 3d, at 429, the uniqueness of the photographs and the
plaintiff's earnings as photographer-past and reasonably
projected-are factors relevant to appraisal of the award. See,
e. g., Blackman v.
Michael Friedman Publishing Group,
Inc., 201 App. Div. 2d 328, 607 N. Y. S. 2d 43, 44 (1st Dept.
1994);
Nierenberg v.
Wursteria, Inc., 189 App. Div.
2d 571, 571-572, 592 N. Y. S. 2d 27, 27-28 (1st Dept. 1993).
Accordingly, we vacate the judgment of the Court of Appeals and
instruct that court to remand the case to the District Court so
that the trial judge, revisiting his ruling on the new trial
motion, may test the jury's verdict against CPLR § 5501(c)'s
"deviates materially" standard.
It is so ordered.
JUSTICE STEVENS, dissenting.
While I agree with most of the reasoning in the Court's opinion,
I disagree with its disposition of the case. I would affirm the
judgment of the Court of Appeals. I would also reject the
suggestion that the Seventh Amendment limits the power of a federal
appellate court sitting in diversity to decide whether a jury's
award of damages exceeds a limit established by state law.
I
The Court correctly explains why the 1986 enactment of § 5501(c)
of the N. Y. Civ. Prac. Law and Rules (McKinney 1995) changed the
substantive law of the State. A state-law ceiling on allowable
damages, whether fixed by a dollar limit or by a standard that
forbids any award that "deviates mate-
440
rially from what would be reasonable compensation,"
ibid., is a substantive rule of decision that federal courts
must apply in diversity cases governed by New York law.
I recognize that state rules of appellate procedure do not
necessarily bind federal appellate courts. The majority
persuasively shows, however, that New York has not merely adopted a
new procedure for allocating the decisionmaking function between
trial and appellate courts.
Ante, at 422425. Instead, New
York courts have held that all jury awards, not only those reviewed
on appeal, must conform to the requirement that they not "deviat[e]
materially" from amounts awarded in like cases.
Ante, at
425. That New York has chosen to tie its damages ceiling to awards
traditionally recovered in similar cases, rather than to a
legislatively determined but inflexible monetary sum, is none of
our concern.
Given the nature of the state-law command, the Court of Appeals
for the Second Circuit correctly concluded in
Consorti v.
Armstrong World Industries, Inc., 64
F.3d 781, superseded,
72 F.3d
1003 (1995), that New York's excessiveness standard applies in
federal court in diversity cases controlled by New York law.
Consorti erred in basing that conclusion in part on the fact
that a New York statute requires that State's appellate division to
apply the standard, but it was nevertheless faithful to the Rules
of Decision Act, as construed in
Erie R. Co. v.
Tompkins, 304
U. S. 64 (1938), in holding that a state-law limitation on the
size of a judgment could not be ignored.1 Similarly, the Court of
Appeals
1 Because there is no conceivable conflict between Federal Rule
of Civil Procedure 59 and the application of the New York damages
limit, this case is controlled by
Erie and the Rules of
Decision Act, rather than by the Rules Enabling Act's limitation on
federal procedural rules that conflict with state substantive
rights. See Ely, The Irrepressible Myth of Erie, 87 Harv. L. Rev.
693, 698 (1974); see also
Sibbach v.
Wilson &
Co., 312 U. S. 1 (1941). The Rule does state that new trials
may be granted "for any of the reasons for which new trials have
heretofore been granted in actions at law in the courts of the
United States," but that hardly consti-
441
correctly followed
Consorti in this case and considered
whether the damages awarded materially deviated from damages
awarded in similar cases.
66 F.3d
427, 431 (CA2 1995). I endorse both opinions in these
respects.
Although the majority agrees with the Court of Appeals that New
York law establishes the size of the damages that may be awarded,
it chooses to vacate and remand. The majority holds that a federal
court of appeals should review for abuse of discretion a district
court's decision to deny a motion for new trial based on a jury's
excessive award. As a result, it concludes that the District Court
should be given the opportunity to apply in the first instance the
"deviates materially" standard that New York law imposes.
Ante, at 439.
The District Court had its opportunity to consider the propriety
of the jury's award, and it erred. The Court of Appeals has now
corrected that error after "drawing all reasonable inferences in
favor of" petitioner. 66 F. 3d, at 431. As there is no reason to
suppose that the Court of Appeals has reached a conclusion with
which the District Court could permissibly disagree on remand, I
would not require the District Court to repeat a task that has
already been well performed by the reviewing court. I therefore
would affirm the judgment of the Court of Appeals.
II
Although I have addressed the question presented as if our
decision in
Erie alone controlled its outcome, petitioner
argues that the second clause of the Seventh Amendment, which
states that "no fact tried by jury, shall be otherwise re-examined
in any Court of the United States, than according to the rules of
the common law," U. S. Const., Amdt. 7,
tutes a command that federal courts must always substitute
federal limits on the size of judgments for those set by the
several States in cases founded upon state-law causes of action.
Even at the time of the Rule's adoption, federal courts were bound
to apply state statutory law in such cases.
442
bars the procedure followed by the Court of Appeals. There is no
merit to that position.
Early cases do state that the Reexamination Clause prohibits
appellate review of excessive jury awards, but they do not
foreclose the practice altogether. See,
e. g.,
Southern Railway-Carolina Div. v.
Bennett, 233 U. S. 80, 87 (1914)
("It may be admitted that if it were true that the excess appeared
as [a] matter of law; that if, for instance, the statute fixed a
maximum and the verdict exceeded it, a question might arise for
this court"); 11 C. Wright, A. Miller, & M. Kane, Federal
Practice and Procedure § 2820, pp. 207-209 (2d ed. 1995). Indeed,
for the last 30 years, we have consistently reserved the question
whether the Constitution permits such review,
ante, at
434-435, and, in the meantime, every Court of Appeals has agreed
that the Seventh Amendment establishes no bar. 11 Wright &
Miller § 2820, at 209.
Taking the question to be an open one, I start with certain
basic principles. It is well settled that jury verdicts are not
binding on either trial judges or appellate courts if they are
unauthorized by law. A verdict may be insupportable as a matter of
law either because of deficiencies in the evidence or because an
award of damages is larger than permitted by law. If an award is
excessive as a matter of law-in a diversity case if it is larger
than applicable state law permits-a trial judge has a duty to set
it aside. A failure to do so is an error of law that the court of
appeals has a duty to correct on appeal.
These principles are sufficiently well established that no
Seventh Amendment issue would arise if an appellate court ordered a
new trial because a jury award exceeded a monetary cap on allowable
damages. That New York has chosen to define its legal limit in less
mathematical terms does not require a different constitutional
conclusion.
New York's limitation requires a legal inquiry that cannot be
wholly divorced from the facts, but that quality does not
necessarily make the question one for the factfinder rather
443
than the reviewing court. Three times this Term we have assigned
appellate courts the task of independently reviewing similarly
mixed questions of law and fact. See
Ornelas v.
United
States, 517 U. S.
690, 696-697 (1996);
Markman v.
Westview Instruments,
Inc., 517 U. S.
370, 388-390 (1996);
Thompson v.
Keohane, 516 U.
S. 90, 112-116 (1995). Such appellate review is proper because
mixed questions require courts to construe all record inferences in
favor of the factfinder's decision and then to determine whether,
on the facts as found below, the legal standard has been met. See
Ornelas, 517 U. S., at 696-697 (quoting
Pullman-Standard v.
Swint, 456 U. S. 273, 289, n. 19
(1982)). In following that procedure here, the Court of Appeals did
not reexamine any fact determined by a jury. 66 F. 3d, at 431. It
merely identified that portion of the judgment that constitutes
"unlawful excess." See
Dimick v.
Schiedt, 293 U. S. 474, 486
(1935).2
Even if review by the Court of Appeals implicates the
Reexamination Clause, it was "according to the rules of the common
law." U. S. Const., Arndt. 7. At common law, the trial judge
sitting
nisi prius recommended whether a judicial panel
sitting en bane at Westminster should accept the jury's award. The
en bane court then ruled on the motion for new trial and entered
judgment. 11 Wright & Miller § 2819, at 203.
Petitioner correctly points out that under this procedure
motions for new trial based on excessiveness were not technically
subject to appellate review. Riddell, New Trial at the Common Law,
26 Yale L. J. 49, 57 (1916) ("It seems clear that in criminal as in
civil cases, the trial Judge had not the
2 I thus disagree with JUSTICE SCALIA'S view that there is a
separate federal standard to "determine whether the award exceeds
what is lawful to such degree that it may be set aside by order for
new trial or remittitur."
Post, at 464. In my view, if an
award "exceeds what is lawful,"
ibid., legal error has
occurred and may be corrected. Certainly
Dimick does not
premise a court's power to overturn an award that exceeds lawful
limits on the degree of the excess.
444
power to grant a new trial, but that recourse must be had to
'the Court above' ");
id., at 60. However, because the
nisi prius judge often did not serve on the en bane court,
the "court above" was in essentially the same position as a modern
court of appeals. It considered the legality of the jury's award in
light of the trial judge's opinion, but without any firsthand
knowledge of what had transpired below. See Blume, Review of Facts
in Jury Cases-The Seventh Amendment, 20 J. Am. Jud. Soc. 130, 131
(1936).3
Petitioner also contends that at common law the en bane court
could only grant a new trial if the trial judge so recommended.
That contention is undermined by numerous cases in which the "court
above" granted new trials without making any reference to the trial
judge's view of the damages. See,
e. g., Honda Motor Co. v.
Oberg, 512 U.
S. 415, 422-425 (1994) (citing cases).4 Moreover, early English
cases repeatedly state that the power to order a new trial when the
jury returned an excessive award rested with "the Court," rather
than the judge below,5 and Blackstone identifies excessive
3 For that reason, JUSTICE SCALIA is wrong to contend that the
court at Westminster acted in no more of an appellate fashion when
it entertained motions for new trials in causes tried at bar than
when it entertained them in causes tried at
nisi prius.
Post, at 456. In the former cases, the en bane court would
entertain a motion for new trial after having heard the evidence
itself. In the latter, it would sometimes entertain the motion only
after having heard the report on the evidence of the
nisi
prius judge.
4 Although
Honda itself involved review of punitive
damages awards, we expressly noted that there was no basis for
suggesting "that different standards of judicial review were
applied for punitive and compensatory damages before the 20th
century," 512 U. S., at 422, n. 2. Indeed, many of the decisions we
relied upon in
Honda involved compensatory damages, and
there is some authority to suggest that judicial review of the
former has a more secure historical pedigree than does judicial
review of the latter.
5 See,
e. g., Bright v.
Eynon, 1 Burr. 390, 97
Eng. Rep. 365, 368 (K. B. 1757) (Denison, J., concurring) ("[T]he
granting a new trial, or refusing it, must depend upon the legal
discretion of the Court; guided by the nature
445
damages as an independent basis on which the "court above" may
grant a new trial but makes no mention of a requirement that the
trial judge must so recommend. 3 W. Blackstone, Commentaries
*387.
Even when read most favorably to petitioner, therefore, no
meaningful distinction exists between the common-law practice by
which the "court above" considered a new trial motion in the first
instance, and the practice challenged here, by which an appellate
court reviews a district court's ruling on a new trial motion. See
Riddell, 26 Yale L. J., at 57. As Justice Stone explained, in a
dissenting opinion joined by Chief Justice Hughes, Justice
Brandeis, and Justice Cardozo:
"[The Seventh Amendment], intended to endure for unnumbered
generations, is concerned with substance and not with form. There
is nothing in its history or language to suggest that the Amendment
had any purpose but to preserve the essentials of the jury trial as
it was known to the common law before the adoption of the
Constitution. For that reason this Court has often refused to
construe it as intended to perpetuate in changeless form the
minutiae of trial practice as it existed in the English
courts in 1791. From the beginning, its language has been regarded
as but subservient to the single purpose of the Amendment, to
preserve the essentials of the jury trial in actions at law,
serving to distinguish them from suits in equity and admiralty, see
Parsons v. Bedford, 3 Pet. 433, 446, and to safeguard
the jury's function from any encroachment which the common law did
not permit.
and circumstances of the particular case, and directed with a
view to the attainment of justice");
Wood v.
Gunston,
Sty. 466, 82 Eng. Rep. 867 (K. B. 1655) ("It is in the discretion
of the Court in some cases to grant a new tryal, but this must be a
judicial, and not an arbitrary discretion, and it is frequent in
our books for the Court to take notice of miscarriages of juries,
and to grant new tryals upon them ... ").
446
"Thus interpreted, the Seventh Amendment guarantees that suitors
in actions at law shall have the benefits of trial of issues of
fact by a jury, but it does not prescribe any particular procedure
by which these benefits shall be obtained, or forbid any which does
not curtail the function of the jury to decide questions of fact as
it did before the adoption of the Amendment. It does not restrict
the court's control of the jury's verdict, as it had previously
been exercised, and it does not confine the trial judge, in
determining what issues are for the jury and what for the court, to
the particular forms of trial practice in vogue in 1791."
Dimick v. Schiedt, 293 U. S., at 490-491.
Because the Framers of the Seventh Amendment evinced no interest
in subscribing to every procedural nicety of the notoriously
complicated English system, see Henderson, The Background of the
Seventh Amendment, 80 Harv. L. Rev. 289, 290 (1966), the common-law
practice certainly does not demonstrate that the Reexamination
Clause prohibits federal appellate courts from ensuring compliance
with statelaw limits on jury awards.
Nor does early and intricate English history justify the more
limited assertion that federal appellate courts must be limited to
a particular, highly deferential standard of excessiveness review.
Common-law courts were hesitant to disturb jury awards, but less so
in cases in which "a reasonably certain measure of damages is
afforded." 1 D. Graham, Law of New Trials in Cases Civil and
Criminal 452 (2d ed. 1855); Washington, Damages in Contract at
Common Law, 47 L. Q. Rev. 345, 363-364 (1931).
Here, New York has prescribed an objective, legallimitation on
damages. If an appellate court may reverse a jury's damages award
when its own conscience has been shocked, 66 F. 3d, at 430, or its
sense of justice outraged,
Dagnello v.
Long Island R.
Co., 289 F.2d
797, 802 (CA2 1961); cf.
Honda Motor Co. v.
Oberg, 512 U. S., at 422-424 (citing English
447
cases), it may surely follow a sovereign's command that it do so
when a jury has materially deviated from awards granted by other
juries. If anything, the New York standard, though less
deferential, is more certain.6
III
For the reasons set forth above, I agree with the majority that
the Reexamination Clause does not bar federal appellate courts from
reviewing jury awards for excessiveness. I confess to some
surprise, however, at its conclusion that "'the influence-if not
the command-of the Seventh Amendment,'"
ante, at 432
(quoting
Byrd v.
Blue Ridge Rural Elec. Cooperative,
Inc., 356 U. S.
525, 537 (1958) (footnote omitted)), requires federal courts of
appeals to review district court applications of state-law
excessiveness standards for an "abuse of discretion."
Ante,
at 438.
The majority's persuasive demonstration that New York law sets
forth a substantive limitation on the size of jury awards seems to
refute the contention that New York has merely asked appellate
courts to reexamine facts. The majority's analysis would thus seem
to undermine the conclusion that the Reexamination Clause is
relevant to this case.
Certainly, our decision in
Byrd does not make the Clause
relevant. There, we considered only whether the Seventh Amendment's
first clause should influence our decision to give effect to a
state-law rule denying the right to a jury
6 Our
per curiam decision in
Donovan v.
Penn
Shipping Co., 429
U. S. 648 (1977), provides no support for the proposition that
federal appellate courts are confined to a federal standard of
excessiveness. That case held only that a plaintiff who had
consented to a remittitur could not challenge its adequacy on
appeal.
Id., at 649. Although we stated in dicta that "[t]he
proper role of the trial and appellate courts in the federal system
in reviewing the size of jury verdicts is, however, a matter of
federal law,"
ibid., that broad statement was supported by
citation to two cases,
Hanna v.
Plumer, 380 U. S. 460 (1965), and
Byrd v.
Blue Ridge Rural Elec. Cooperative, Inc.,
356 U. S. 525
(1958), which did not involve the review of jury awards.
448
altogether. 356 U. S., at 537. That holding in no way requires
us to consult the Amendment's second clause to determine the
standard of review for a district court's application of state
substantive law.
My disagreement is tempered, however, because the majority
carefully avoids defining too strictly the abuse-ofdiscretion
standard it announces. To the extent that the majority relies only
on "practical reasons" for its conclusion that the Court of Appeals
should give some weight to the District Court's assessment in
determining whether state substantive law has been properly
applied,
ante, at 438, I do not disagree with its
analysis.
As a matter of federal-court administration, we have recognized
in other contexts the need for according some deference to the
lower court's resolution of legal, yet factintensive, questions.
See
Ornelas v.
United States, 517 U. S., at 699;
Pierce v.
Underwood, 487 U. S. 552, 558, n. 1
(1988). Indeed, it is a familiar, if somewhat circular, maxim that
deems an error of law an abuse of discretion.
In the end, therefore, my disagreement with the label that the
majority attaches to the standard of appellate review should not
obscure the far more fundamental point on which we agree. Whatever
influence the Seventh Amendment may be said to exert,
Erie
requires federal appellate courts sitting in diversity to apply
"the damage-control standard state law supplies."
Ante, at
438.
IV
Because I would affirm the judgment of the Court of Appeals, and
because I do not agree that the Seventh Amendment in any respect
influences the proper analysis of the question presented, I
respectfully dissent.
JUSTICE SCALIA, with whom THE CHIEF JUSTICE and JUSTICE THOMAS
join, dissenting.
Today the Court overrules a longstanding and wellreasoned line
of precedent that has for years prohibited fed-
449
eral appellate courts from reviewing refusals by district courts
to set aside civil jury awards as contrary to the weight of the
evidence. One reason is given for overruling these cases: that the
Courts of Appeals have, for some time now, decided to ignore them.
Such unreasoned capitulation to the nullification of what was long
regarded as a core component of the Bill of Rights-the Seventh
Amendment's prohibition on appellate reexamination of civil jury
awardsis wrong. It is not for us, much less for the Courts of
Appeals, to decide that the Seventh Amendment's restriction on
federal-court review of jury findings has outlived its
usefulness.
The Court also holds today that a state practice that relates to
the division of duties between state judges and juries must be
followed by federal courts in diversity cases. On this issue, too,
our prior cases are directly to the contrary.
As I would reverse the judgment of the Court of Appeals, I
respectfully dissent.
I
Because the Court and I disagree as to the character of the
review that is before us, I recount briefly the nature of the New
York practice rule at issue. Section 5501(c) of the N. Y. Civ.
Prac. Law and Rules (CPLR) (McKinney 1995) directs New York
intermediate appellate courts faced with a claim "that the award is
excessive or inadequate and that a new trial should have been
granted" to determine whether the jury's award "deviates materially
from what would be reasonable compensation." In granting respondent
a new trial under this standard, the Court of Appeals necessarily
engaged in a two-step process. As it has explained the application
of § 5501(c), that provision "requires the reviewing court to
determine the range it regards as reasonable, and to determine
whether the particular jury award deviates materially from that
range."
Consorti v.
Armstrong World Industries, Inc.,
72 F.3d
1003, 1013 (CA2 1995) (amended). The first of these two
steps-the determination as to "rea-
450
sonable" damages-plainly requires the reviewing court to
reexamine a factual matter tried by the jury: the appropriate
measure of damages, on the evidence presented, under New York law.
The second step-the determination as to the degree of difference
between "reasonable" damages and the damages found by the jury
(whether the latter "deviates materially" from the
former)-establishes the degree of judicial tolerance for awards
found not to be reasonable, whether at the trial level or by the
appellate court. No part of this exercise is appropriate for a
federal court of appeals, whether or not it is sitting in a
diversity case.
A
Granting appellate courts authority to decide whether an award
is "excessive or inadequate" in the manner of CPLR § 5501(c) may
reflect a sound understanding of the capacities of modern juries
and trial judges. That is to say, the people of the State of New
York may well be correct that such a rule contributes to a more
just legal system. But the practice of
federal appellate
reexamination of facts found by a jury is precisely what the People
of the several States considered
not to be good legal policy
in 1791. Indeed, so fearful were they of such a practice that they
constitutionally prohibited it by means of the Seventh
Amendment.
That Amendment was Congress's response to one of the principal
objections to the proposed Constitution raised by the
Anti-Federalists during the ratification debates: its failure to
ensure the right to trial by jury in civil actions in federal
court. The desire for an explicit constitutional guarantee against
reexamination of jury findings was explained by Justice Story,
sitting as Circuit Justice in 1812, as having been specifically
prompted by Article Ill's conferral of "appellate Jurisdiction,
both as to Law and Fact" upon the Supreme Court. "[O]ne of the most
powerful objections urged against [the Constitution]," he
recounted, was that this au-
451
thority "would enable that court, with or without a new jury, to
re-examine the whole facts, which had been settled by a previous
jury."
United States v.
Wonson, 28 F. Cas. 745, 750
(No. 16,750) (CC Mass.).l
The second clause of the Amendment responded to that concern by
providing that "[i]n [s]uits at common law ... no fact tried by a
jury, shall be otherwise re-examined in any Court of the United
States, than according to the rules of the common law." U. S.
Const., Arndt. 7. The Reexamination Clause put to rest
"apprehensions" of "new trials by the appellate courts,"
Wonson, 28 F. Cas., at 750, by adopting, in broad fashion,
"the rules of the common law" to govern federal-court interference
with jury determinations.2 The
1 This objection was repeatedly made following the
Constitutional Convention, see,
e. g., Martin,
Genuine Information, in 3 Records of the Federal Convention of
1787, pp. 172, 221-222 (M. Farrand ed. 1911); Gerry, Reply to a
Landholder,
id., at 298, 299, and at the ratifying
conventions in the States, see,
e. g., 3 J. Elliot,
Debates on the Federal Constitution 525, 540-541, 544-546 (1863)
(Virginia Convention, statements of Mr. Mason and Mr. Henry); 4
id., at 151, 154 (North Carolina Convention, statements of
Mr. Bloodworth and Mr. Spencer).
Prior to adoption of the Amendment, these concerns were
addressed by Congress in the Judiciary Act of 1789,1 Stat. 73,
which expressly directed, in providing for "reexamin[ation]" of
civil judgments "upon a writ of error," that "there shall be no
reversal in either [the Circuit or Supreme Court] ... for any error
of fact." §22, 1 Stat. 84-85. That restriction remained in place
until the 1948 revisions of the Judicial Code. See 62 Stat. 963, 28
U. S. C. § 2105 (1946 ed., Supp. II).
2 The Amendment was relied upon at least twice to prevent actual
new trials. In
Wonson itself, Justice Story rejected the
United States' claim of right to retry, on appeal, a matter
unsuccessfully put before a jury in the District
Court-notwithstanding acceptance of such a practice under local
law. The court based its ruling on statutory grounds, but its
interpretation of its statutory jurisdiction was dictated by its
view that a contrary interpretation would contravene the Seventh
Amendment. 28 F. Cas., at 750. And in
Justices v.
Murray, 9 Wall. 274, 281 (1870), this Court relied on
Wonson in invalidating under the Seventh Amendment a federal
habeas statute that provided for removal of certain judgments from
state courts for purposes of retrial in federal court.
452
content of that law was familiar and fixed. See,
e. g.,
ibid. ("[T]he common law here alluded to is not the common law
of any individual state, (for it probably differs in all), but it
is the common law of England, the grand reservoir of all our
jurisprudence");
Dimick v.
Schiedt, 293 U. S. 474, 487 (1935)
(Seventh Amendment "in effect adopted the rules of the common law,
in respect of trial by jury, as these rules existed in 1791"). It
quite plainly barred reviewing courts from entertaining claims that
the jury's verdict was contrary to the evidence.
At common law, review of judgments was had only on writ of
error, limited to questions of law. See,
e. g., Wonson,
supra, at 748; 3 W. Blackstone, Commentaries on the Laws of
England 405 (1768) ("The writ of error only lies upon matter of
law arising upon the face of the proceedings; so that no
evidence is required to substantiate or support it"); 1 W.
Holdsworth, History of English Law 213-214 (7th ed. 1956); cf.
Ross v.
Rittenhouse, 2 Dall. 160, 163 (Pa. 1792)
(McKean, C. J.). That principle was expressly acknowledged by this
Court as governing federal practice in
Parsons v.
Bedford, 3 Pet. 433 (1830) (Story, J.). There, the Court
held that no error could be assigned to a district court's refusal
to allow transcription of witness testimony "to serve as a
statement of facts in case of appeal," notwithstanding the right to
such transcription under state practices made applicable to federal
courts by Congress.
Id., at 443 (emphasis deleted). This was
so, the Court explained, because "[t]he whole object" of the
transcription was "to present the evidence here in order to
establish the error of the verdict in matters of fact,"
id.,
at 445-a mode of review simply unavailable on writ of error, see
id., at 446, 448. The Court concluded that Congress had not
directed federal courts to follow state practices that would change
"the effect or conclusiveness of the verdict of the jury upon the
facts litigated at the trial,"
id., at 449, because it had
"the most serious doubts whether
453
[that] would not be unconstitutional" under the Seventh
Amendment,
id., at 448.
"This is a prohibition to the courts of the United States to
re-examine any facts tried by a jury in any other manner. The only
modes known to the common law to reexamine such facts, are the
granting of a new trial by the court where the issue was tried, or
to which the record was properly returnable; or the award of a
venire facias de novo, by an appellate court, for some error of law
which intervened in the proceedings.
"[I]f the evidence were now before us, it would not be competent
for this court to reverse the judgment for any error in the verdict
of the jury at the trial .... " Id., at 447-449.
Nor was the common-law proscription on reexamination limited to
review of the correctness of the jury's determination of liability
on the facts. No less than the existence of liability, the proper
measure of damages "involves only a question of fact,"
St.
Louis, 1.
M. & S.
R. Co. v.
Craft, 237
U. S. 648, 661 (1915), as does a "motio[n] for a new trial based on
the ground that the damages ... are excessive,"
Metropolitan R.
Co. v.
Moore, 121 U. S. 558, 574
(1887). As appeals from denial of such motions necessarily pose a
factual question, courts of the United States are constitutionally
forbidden to entertain them.
"No error of law appearing upon the record, this court cannot
reverse the judgment because, upon examination of the evidence, we
may be of the opinion that the jury should have returned a verdict
for a less amount. If the jury acted upon a gross mistake of facts,
or were governed by some improper influence or bias, the remedy
therefore rested with the court below, under its gen-
454
eral power to set aside the verdict .... Whether [the refusal to
exercise that power] was erroneous or not, our power is restricted
by the Constitution to the determination of the questions of law
arising upon the record. Our authority does not extend to a
re-examination of facts which have been tried by the jury under
instructions correctly defining the legal rights of parties.
Parsons v. Bedford, [supra] .... " Railroad Co. v.
Fraloff, 100 U.
S. 24, 31-32 (1879).
This view was for long years not only unquestioned in our cases,
but repeatedly affirmed.3
3 See,
e. g., Wabash R. Co. v.
McDaniels, 107 U. S. 454, 456 (1883)
("That we are without authority to disturb the judgment upon the
ground that the damages are excessive cannot be doubted. Whether
the order overruling the motion for a new trial based upon that
ground was erroneous or not, our power is restricted to the
determination of questions of law arising upon the record.
Railroad Company v.
Fraloff, 100 U. S. 24
[(1879)]"); Arkansas Valley Land &
Cattle Co. v.
Mann, 130 U. S.
69, 75 (1889) ("[H]owever it was ascertained by the court that
the verdict was too large ... , the granting or refusing a new
trial in a Circuit Court of the United States is not subject to
review by this court") (citing
Parsons v.
Bedford, 3
Pet. 433 (1830);
Railroad Co. v.
Fraloff, 100 U. S. 24 (1879));
Lincoln v.
Power, 151 U. S. 436, 437-438
(1894) ("[I]t is not permitted for this court, sitting as a court
of errors, in a case wherein damages have been fixed by the verdict
of a jury, to take notice of [a claim of excessive damages] where
the complaint is only of the action of the jury .... [W]here there
is no reason to complain of the instructions, an error of the jury
in allowing an unreasonable amount is to be redressed by a motion
for a new trial") (citing
Parsons, supra; Fraloff, supra);
Chicago, B. &
Q. R. Co. v.
Chicago,
166 U. S. 226,
242-246 (1897);
Southern Railway-Carolina Div. v.
Bennett, 233 U.
S. 80, 87 (1914) ("[A] case of mere excess upon the evidence is
a matter to be dealt with by the trial court. It does not present a
question for reexamination here upon a writ of error") (citing
Lincoln, supra); Fairmount Glass Works v.
Cub Fork Coal
Co., 287 U. S.
474,481482 (1933) ("The rule that this Court will not review
the action of a federal trial court in granting or denying a motion
for a new trial for error of fact has been settled by a long and
unbroken line of decisions; and has been frequently applied where
the ground of the motion was that the damages
455
B
Respondent's principal response to these cases, which is
endorsed by JUSTICE STEVENS, see
ante, at 443-445, is that
our forebears were simply wrong about the English common law. The
rules of the common-law practice incorporated in the Seventh
Amendment, it is claimed, did
not prevent judges sitting in
an appellate capacity from granting a new trial on the ground that
an award was contrary to the weight of the evidence. This claim
simply does not withstand examination of the actual practices of
the courts at common law. The weight of the historical record
strongly supports the view of the common law taken in our early
cases.
At common law, all major civil actions were initiated before
panels of judges sitting at the courts of Westminster. Trial was
not always held at the bar of the court, however. The inconvenience
of having jurors and witnesses travel to Westminster had given rise
to the practice of allowing trials to be held in the countryside,
before a single itinerant judge. This
nisi prius trial, as
it was called, was limited to the jury's deciding a matter of fact
in dispute; once that was accomplished, the verdict was entered on
the record whichalong with any exceptions to the instructions or
rulings of the
nisi prius judge-was then returned to the en
banc court at Westminster. See generally 1 Holdsworth, History of
English Law, at 223-224, 278-282; G. Radcliffe & G. Cross, The
English Legal System 90-91, 183-186 (3d ed. 1954). Requests for new
trials were made not to the
nisi prius judge, but to the en
banc court, prior to further proceedings and entry of judgment. See
1 Holdsworth,
supra, at 282; Riddell, New Trial at the
Common Law, 26 Yale L. J. 49, 53, 57 (1916). Such motions were
altogether separate from appeal on writ of error, which followed
the entry of judg-
awarded by the jury were excessive or were inadequate"
(footnotes omitted)).
456
ment. 1 Holdsworth,
supra, at 213-214; Radcliffe &
Cross,
supra, at 210-212.4
Nonetheless, respondent argues, the role of the en bane court at
Westminster was essentially that of an appellate body, reviewing
the proceedings below; and those appellate judges
were
capable of examining the evidence, and of granting a new trial
when, in their view, the verdict was contrary to the weight of the
evidence. See Blume, Review of Facts in Jury Cases-The Seventh
Amendment, 20 J. Am. Jud. Soc. 130, 131 (1936); Riddell,
supra, at 55-57, 60. There are two difficulties with this
argument. The first is the characterization of the court at
Westminster as an appellate body. The court's role with respect to
the initiation of the action, the entertaining of motions for new
trial, and the entry of judgment was the same in all cases-whether
the cause was tried at the bar or at
nisi prius. To regard
its actions in deciding a motion for a new trial as "appellate" in
the latter instance supposes a functional distinction where none
existed. The second difficulty is that when the trial had been held
at
nisi prius, the judges of the en bane court apparently
would order a new trial only if the
nisi prius judge
certified that he was dissatisfied with the verdict. To be sure,
there are many cases where no mention is made of the judge's
certificate, but there are many indications that it was a required
predicate to setting aside a verdict rendered at
nisi prius,
and respondent has been unable to identify a single case where a
new trial was granted in the absence of such certification. In
short, it would seem that a new trial could not
4 The grounds for granting a new trial were "want of notice of
trial; or any flagrant misbehavior of the party prevailing towards
the jury, which may have influenced their verdict; or any gross
misbehavior of the jury among themselves: also if it appears by the
judge's report, certified to the court, that the jury have brought
in a verdict without or contrary to evidence, so that he is
reasonably dissatisfied therewith; or if they have given exorbitant
damages; or if the judge himself has misdirected the jury, so that
they found an unjustifiable verdict." 3 W. Blackstone, Commentaries
on the Laws of England 387 (1768) (footnotes omitted; emphases
deleted).
457
be had except upon the approval of the judge who presided over
the trial and heard the evidence.5
I am persuaded that our prior cases were correct that, at common
law, "reexamination" of the facts found by a jury could be
undertaken only by the trial court, and that appellate review was
restricted to writ of error which could challenge the judgment only
upon matters of law. Even if there were some doubt on the point, we
should be hesitant to advance our view of the common law over that
of our forbears, who were far better acquainted with the subject
than we are. But in any event, the question of how to apply the
"rules of the common law" to federal appellate consideration of
mo-
5 See
ibid. (new trial would be granted "if it appears by
the judge's report, certified to the court, that the jury have
brought in a verdict without or contrary to evidence, so that he is
reasonably dissatisfied therewith"). See,
e. g., Berks v.
Mason, Say. 264,265,96 Eng. Rep. 874, 874-875 (K. B. 1756);
Bright v.
Eynon, 1 Burr. 390, 97 Eng. Rep. 365 (K. B.
1757); see also Note, Limitations on Trial by Jury in Illinois, 19
Chi.-Kent L. Rev. 91, 92 (1940) ("An exhaustive examination of the
early English cases has revealed not a single case where an English
court at common law ever granted a new trial, as being against the
evidence, unless the judge or judges who sat with the jury stated
in open court, or certified, that the verdict was against the
evidence and he was dissatisfied with the verdict").
JUSTICE STEVENS understands Blackstone to say that new trials
were granted for
excessiveness even where the
nisi
prius judge was not dissatisfied with the damages awarded, see
ante, at 444-445. Blackstone's phrasing certainly allows for
this reading, see n. 4,
supra, but what indications we have
suggest that the dissatisfaction of the presiding judge played the
same role where the motion for new trial was based on a claim of
excessive damages as where based on a claim of an erroneous
verdict. See,
e. g., Boulsworth v.
Pilkington, Jones,
T. 200, 84 Eng. Rep. 1216 (K. B. 1685);
Redshaw v.
Brook, 2 Wils. K. B. 405, 95 Eng. Rep. 887
(C. P.
1769); Sharpe v.
Brice, 2 Black. W. 942, 96 Eng. Rep.
557
(C. P. 1774). The cases cited by JUSTICE STEVENS,
ante, at 444-445, n. 5, are not at all to the contrary: In
one, the case was tried at the bar of the court, so that there was
no
nisi prius judge, see
Wood v.
Gunston, Sty.
466, 82 Eng. Rep. 867 (K. B. 1655); in the other, the judge who had
presided at trial was on the panel that ruled on the new trial
motion, and recommended a new trial, see
Bright v.
Eynon,
supra, at 390-391, 396-397, 97 Eng. Rep., at 365, 368.
458
tions for new trials is one that has already been clearly and
categorically answered, by our precedents. As we said in
Dimick v.
Schiedt, 293 U. S. 474 (1935), in
discussing the status of remittitur under "the rules of the common
law," a doctrine that "has been accepted as the law for more than a
hundred years and uniformly applied in the federal courts during
that time" and "finds some support in the practice of the English
courts prior to the adoption of the Constitution" will not lightly
"be reconsidered or disturbed,"
id., at 484485. The time to
question whether orders on motions for a new trial were in fact
reviewable at common law has long since passed. Cases of this Court
reaching back into the early 19th century establish that the
Constitution forbids federal appellate courts to "reexamine" a fact
found by the jury at trial; and that this prohibition encompasses
review of a district court's refusal to set aside a verdict as
contrary to the weight of the evidence.
C
The Court, as is its wont of late, all but ignores the relevant
history. It acknowledges that federal appellate review of
district-court refusals to set aside jury awards as against the
weight of the evidence was "once deemed inconsonant with the
Seventh Amendment's Reexamination Clause,"
ante, at 434, but
gives no indication of why ever we held that view; and its citation
of only one of our cases subscribing to that proposition fails to
convey how long and how clearly it was a fixture of federal
practice, see
ibid. (citing only
Lincoln v.
Power, 151 U.
S. 436 (1894)). That our earlier cases are so poorly recounted
is not surprising, however, given the scant analysis devoted to the
conclusion that "appellate review for abuse of discretion is
reconcilable with the Seventh Amendment,"
ante, at 435.
No precedent of this Court affirmatively supports that
proposition. The cases upon which the Court relies neither
459
affirmed nor rejected the practice of appellate
weight-ofthe-evidence review that has been adopted by the courts of
appeals-a development that, in light of our past cases, amounts to
studied waywardness by the intermediate appellate bench. Our
unaccountable reluctance, in
Grunenthal v.
Long Island R.
Co., 393 U. S.
156, 158 (1968), and
Neese v.
Southern R. Co.,
350 U. S. 77
(1955), to stand by our precedents, and the undeniable illogic of
our disposition of those two cases-approving ourselves a
district-court denial of a new trial motion, so as not to have to
confront the lawfulness of reversal by the court of appeals-is
authority of only the weakest and most negative sort. Nor can any
weight be assigned to our statement in
Browning-Ferris
Industries of Vt., Inc. v.
Kelco Disposal, Inc.,
492 U. S. 257,
279 (1989), seemingly approving appellate abuse-of-discretion
review of denials of new trials where punitive damages are claimed
to be excessive.
Browning-Ferris, like
Grunenthal and
Neese, explicitly avoided the question that is before us
today, see 492 U. S., at 279, n. 25. Even more significantly,
BrowningFerris involved review of a jury's
punitive
damages award. Unlike the measure of actual damages suffered, which
presents a question of historical or predictive fact, see,
e. g., Craft, 237 U. S., at 661, the level of
punitive damages is not really a "fact" "tried" by the jury. In
none of our cases holding that the Reexamination Clause prevents
federal appellate review of claims of excessive damages does it
appear that the damages had a truly "punitive" component.
In any event, it is not
this Court's statements that the
Court puts forward as the basis for dispensing with our prior
cases. Rather, it is the Courts of Appeals' unanimous "agree[ment]"
that they may review trial-court refusals to set aside jury awards
claimed to be against the weight of the evidence.
Ante, at
435. This current unanimity is deemed controlling, notwithstanding
the "relatively late" origin of the practice,
ante, at 434,
and without
any inquiry into the
460
reasoning set forth in those Court of Appeals decisions.6 The
Court contents itself with citations of two federal appellate cases
and the assurances of two leading treatises that the view (however
meager its intellectual provenance might be) is universally held.
See
ante, at 435-436. To its credit, one of those treatises
describes the "dramatic change in doctrine" represented by
appellate abuse-of-discretion review of denials of new trial orders
generally as having been "accomplished by a blizzard of dicta"
that, through repetition alone, has "given legitimacy to a doctrine
of doubtful constitutionality." 11 C. Wright, A. Miller, & M.
Kane, Federal Practice and Procedure § 2819, pp. 200, 204 (2d ed.
1995).7
The Court's only suggestion as to what rationale might underlie
approval of abuse-of-discretion review is to be found in a
quotation from
Dagnello v.
Long Island R. Co.,
289 F.2d
797 (CA2 1961), to the effect that review of denial of a new
trial motion, if conducted under a sufficiently deferential
standard, poses only "'a question of law.'''
Ante, at 435
(quoting
Dagnello, supra, at 806). But that is not the test
that the Seventh Amendment sets forth. Whether or not it
6 The Second Circuit, notwithstanding its practice with respect
to excessiveness claims, will not review a district court's
determination that the jury's liability ruling was supported by the
weight of the evidence, see
Stonewall Ins. Co. v.
Asbestos Claims Management, 73 F.3d
1178, 1199 (1995) (such a decision is "one of those few rulings
that is simply unavailable for appellate review"), and the Eighth
Circuit has questioned whether the Seventh Amendment permits
appellate review of such determinations, see
Thongvanh v.
Thalacker, 17 F.3d
256, 259-260 (1994); see also
White
7 I am at a loss to understand the Court's charge that keeping
faith with our precedents-and requiring that the courts of appeals
do likewisewould" 'destroy the uniformity of federal practice,'"
ante, at 436, n. 19. I had thought our decisions established
uniformity. And as for commentators' observations that it would be
"'astonishing'" for us actually to heed our precedents, see
ibid., quoting 11 Wright, Miller, & Kane, § 2820, at
212, they are no more than a prediction of inconstancy-which the
Court today fulfills.
461
is possible to characterize an appeal of a denial of new trial
as raising a "legal question," it is not possible to review such a
claim without engaging in a "reexamin[ationJ" of the "facts tried
by the jury" in a manner "otherwise" than allowed at common law.
Determining whether a particular award is excessive requires that
one first determine the nature and extent of the harm-which
undeniably requires reviewing the facts of the case. That the
court's review also entails application of a legal standard
(whether "shocks the conscience," "deviates materially," or some
other) makes no difference, for what is necessarily
also
required is
reexamination of facts found by the jury.
In the last analysis, the Court frankly abandons any pretense at
faithfulness to the common law, suggesting that "the meaning" of
the Reexamination Clause was not "fixed at
1791," ante, at
436, n. 20, contrary to the view that all our prior discussions of
the Reexamination Clause have adopted, see
supra, at
451-454. The Court believes we can ignore the very explicit command
that "no fact tried by a jury shall be otherwise reexamined in any
Court of the United States, than according to the rules of the
common law" because, after all, we have not insisted that juries be
all male, or consist of 12 jurors, as they were at common law.
Ante, at 436, n. 20. This is a desperate analogy, since
there is of course no comparison between the specificity of the
command of the Reexamination Clause and the specificity of the
command that there be a "jury." The footnote abandonment of our
traditional view of the Reexamination Clause is a major step
indeed.8
8
Gasoline Products Co. v.
Champlin Refining Co.,
283 U. S. 494
(1931), is the only case cited in the Court's footnote that
arguably involved the slightest departure from common-law practices
regarding review of jury findings. It held, to be sure, that a new
trial could be ordered on damages alone, even though at common law
there was no practice of setting a verdict aside in part. But it
did so only after satisfying itself that the change
462
II
The Court's holding that federal courts of appeals may review
district-court denials of motions for new trials for error of fact
is not the only novel aspect of today's decision. The Court also
directs that the case be remanded to the District Court, so that it
may "test the jury's verdict against CPLR § 5501(c)'s 'deviates
materially' standard."
Ante, at 439. This disposition
contradicts the principle that "[t]he proper role of the trial and
appellate courts in the federal system in reviewing the size of
jury verdicts is ... a matter of federal law."
Donovan v.
Penn Shipping Co., 429 U. S. 648, 649
(1977) (per curiam).
The Court acknowledges that state procedural rules cannot, as a
general matter, be permitted to interfere with the allocation of
functions in the federal court system, see
ante, at 436-437.
Indeed, it is at least partly for this reason that the Court
rejects direct application of § 5501(c) at the appellate level as
inconsistent with an "'essential characteristic'" of the federal
court system-by which the Court presumably means
abuse-of-discretion review of denials of motions for new trials.
See
ante, at 431, 437-438. But the scope of the Court's
concern is oddly circumscribed. The "essential characteristic" of
the federal jury, and, more specifically, the role of the federal
trial court in reviewing jury judgments, apparently counts for
little. The Court approves the "ac-
was one of "form" rather than "substance," quoting Lord
Mansfield to the effect that '''for form's sake, we must set aside
the whole verdict.'''
Id., at 498 (quoting
Edie v.
East India Co., 1 Black W. 295, 298, 96 Eng. Rep. 166, 167
(K. B. 1761)). It can hardly be maintained that whether or not a
jury's damages award may be set aside on appeal is a matter of
form. The footnote also cites 9A C. Wright & A. Miller, Federal
Practice and Procedure § 2522 (2d ed. 1995), for its discussion of
Federal Rule of Civil Procedure 50(b), which permits post-trial
motion for judgment as a matter of law. The Court neglects to
mention that that discussion states: "The Supreme Court held that
reservation of the decision in this fashion had been recognized at
common law ... ."
Id., §2522, at 245.
463
commodat[ion]" achieved by having district courts review jury
verdicts under the "deviates materially" standard, because it
regards that as a means of giving effect to the State's purposes
"without disrupting the federal system,"
ante, at 437. But
changing the standard by which trial judges review jury verdicts
does disrupt the federal system, and is plainly inconsistent
with the "strong federal policy against allowing state rules to
disrupt the judge-jury relationship in the federal court."
Byrd v.
Blue Ridge Rural Elec. Cooperative, Inc.,
356 U. S. 525,
538 (1958).9 The Court's opinion does not even acknowledge, let
alone address, this dislocation.
We discussed precisely the point at issue here in
Browning-Ferris Industries of Vt., Inc. v.
Kelco
Disposal, Inc., 492 U. S. 257 (1989), and
gave an answer altogether contrary to the one provided today.
Browning-Ferris rejected a request to fashion a federal
common-law rule limiting the size of punitive damages awards in
federal courts, reaffirming the principle of
Erie R. Co. v.
Tompkins, 304
U. S. 64 (1938), that "[i]n a diversity action, or in any other
lawsuit where state law provides the basis of decision, the
propriety of an award of punitive damages ... , and the factors the
jury may consider in determining their amount, are questions of
state law." 492 U. S., at 278. But the opinion expressly stated
that "[f]ederal law ... will control on those issues involving the
proper review of the jury award by a federal district court and
court of appeals."
Id., at 278-279. "In reviewing an award
of punitive damages," it said, "the role of the district court is
to determine whether the jury's verdict is within the confines set
by state law, and to determine, by reference to federal standards
developed under Rule 59, whether a new trial or remittitur should
be ordered."
Id., at 279. The same distinction necessarily
applies where the
9 Since I reject application of the New York standard on other
grounds, I need not consider whether it constitutes "reexamination"
of a jury's verdict in a manner "otherwise ... than according to
the rules of the common law."
464
judgment under review is for compensatory damages: State
substantive law controls what injuries are compensable and in what
amount; but federal standards determine whether the award exceeds
what is lawful to such degree that it may be set aside by order for
new trial or remittitur.10
The Court does not disavow those statements in
Browning-Ferris (indeed, it does not even discuss them), but
it presumably overrules them, at least where the state rule that
governs "whether a new trial or remittitur should be ordered" is
characterized as "substantive" in nature. That, at any rate, is the
reason the Court asserts for giving § 5501(c) dispositive effect.
The objective of that provision, the Court states, "is manifestly
substantive,"
ante, at 429, since it operates to "contro[l]
how much a plaintiff can be awarded" by "tightening the range of
tolerable awards,"
ante, at 425, 426. Although "less readily
classified" as substantive than "a statutory cap on damages," it
nonetheless "was designed to provide an analogous control,"
ante, at 428, 429, by making a new trial mandatory when the
award "deviat[es] materially" from what is reasonable, see
ante, at 428-429.
I do not see how this can be so. It seems to me quite wrong to
regard this provision as a "substantive" rule for
Erie
purposes. The "analog[y]" to "a statutory cap on damages,"
ante, at 428, 429, fails utterly. There is an absolutely
fundamental distinction between a
rule of law such as that,
which would ordinarily be imposed upon the jury in the trial
court's instructions, and a
rule of review, which simply
determines how closely the jury verdict will be scrutinized for
10 JUSTICE STEVENS thinks that if an award" 'exceeds what is
lawful,'" the result is "legal error" that "may be corrected" by
the appellate court.
Ante, at 443, n. 2. But the sort of
"legal error" involved here is the imposition of legal consequences
(in this case, damages) in light of
facts that, under the
law, may not warrant them. To suggest that every fact may be
reviewed, because what may ensue from an erroneous factual
determination is a "legal error," is to destroy the notion that
there is a factfinding function reserved to the jury.
465
compliance with the instructions. A tighter standard for
reviewing jury determinations can no more plausibly be called a
"substantive" disposition than can a tighter appellate standard for
reviewing trial-court determinations. The one, like the other,
provides additional assurance
that the law has been complied
with; but the other, like the one,
leaves the law
unchanged.
The Court commits the classic
Erie mistake of regarding
whatever changes the outcome as substantive, see
ante, at
428-431. That is not the only factor to be considered. See
Byrd,
supra, at 537 ("[W]ere 'outcome' the only consideration, a
strong case might appear for saying that the federal court should
follow the state practice. But there are affirmative countervailing
considerations at work here"). Outcome determination "was never
intended to serve as a talisman,"
Hanna v.
Plumer,
380 U. S. 460,
466-467 (1965), and does not have the power to convert the most
classic elements of the
process of assuring that the law is
observed into the substantive law itself. The right to have a jury
make the findings of fact, for example, is generally thought to
favor plaintiffs, and that advantage is often thought significant
enough to be the basis for forum selection. But no one would argue
that
Erie confers a right to a jury in federal court
wherever state courts would provide it; or that, were it not for
the Seventh Amendment,
Erie would require federal courts to
dispense with the jury whenever state courts do so.
In any event, the Court exaggerates the difference that the
state standard will make. It concludes that different outcomes are
likely to ensue depending on whether the law being applied is the
state "deviates materially" standard of § 5501(c) or the "shocks
the conscience" standard. See
ante, at 429-430. Of course it
is not the federal
appellate standard but the federal
district-court standard for granting new trials that must be
compared with the New York standard to determine whether
substantially different results will obtain-and it is far from
clear that the district-court standard
466
ought to be "shocks the conscience." 11 Indeed, it is not
even clear (as the Court asserts) that "shocks the conscience"
is the standard (erroneous or not) actually applied by the
district courts of the Second Circuit. The Second Circuit's test
for reversing a grant of a new trial for an excessive verdict is
whether the award was
"clearly within the maximum limit of a
reasonable range,"
Ismail v.
Cohen, 899 F.2d
183, 186 (CA2 1990) (internal quotation marks omitted), so any
district court that uses that standard will be affirmed. And while
many district-court decisions express the "shocks the conscience"
criterion, see,
e. g., Koerner v.
Club Mediterranee,
S.
A., 833 F. Supp. 327, 333 (SDNY 1993), some have used a
standard of "indisputably egregious,"
Banff v.
Express, Inc., 921 F. Supp. 1065, 1069 (SDNY 1995), or have
adopted the inverse of the Second Circuit's test for reversing a
grant of new trial, namely,
"clearly outside the maximum
limit of a reasonable range,"
Paper Corp. v.
Schoeller
Technical Papers, Inc., 807 F. Supp. 337, 350-351 (SDNY 1992).
Moreover, some decisions that
say "shocks the conscience" in
fact apply a rule much less stringent. One case, for example, says
that
any award that would not be sustained under the New
York "deviates materially" rule "shocks the conscience." See
In
re Joint Eastern & S.
Dist. Asbestos Litigation, 798
F. Supp. 925, 937 (E&SDNY 1992), rev'd on other grounds,
995 F.2d
343, 346 (CA2 1993). In sum, it is at least highly questionable
whether the consistent outcome differential claimed by the Court
even exists. What seems to me far more likely to produce forum
shopping is the consistent difference between the state and federal
appellate standards, which the Court leaves untouched. Under
the Court's
11 That the "shocks the conscience" standard was not the
traditional one would seem clear from the opinion of Justice Story,
quoted approvingly by the Court,
ante, at 433, to the effect
that remittitur should be granted "if it should clearly appear that
the jury ... have given damages excessive in relation to the person
or the injury."
Blunt v.
Little, 3 F. Cas. 760,
761-762 (No. 1,578)
(CC Mass. 1822).
467
disposition, the Second Circuit reviews only for abuse of
discretion, whereas New York's appellate courts engage in a
de
novo review for material deviation, giving the defendant a
double shot at getting the damages award set aside. The only result
that would produce the conformity the Court erroneously believes
Erie requires is the one adopted by the Second Circuit and
rejected by the Court:
de novo federal appellate review
under the § 5501(c) standard.
To say that application of § 5501(c) in place of the federal
standard will not consistently produce disparate results is not to
suggest that the decision the Court has made today is not a
momentous one. The
principle that the state standard governs
is of great importance, since it bears the potential to destroy the
uniformity of federal practice and the integrity of the federal
court system. Under the Court's view, a state rule that directed
courts "to determine that an award is excessive or inadequate if it
deviates
in any degree from
the proper measure of
compensation" would have to be applied in federal courts,
effectively requiring federal judges to determine the amount of
damages
de novo, and effectively taking the matter away from
the jury entirely. Cf.
Byrd, 356 U. S., at 537-538. Or
consider a state rule that allowed the defendant a second trial on
damages, with judgment ultimately in the amount of the lesser of
two jury awards. Cf.
United States v.
Wonson, 28 F.
Cas., at 747-748 (describing Massachusetts practice by which a
second jury trial could be had on appeal). Under the reasoning of
the Court's opinion, even such a rule as that would have to be
applied in the federal courts.
The foregoing describes why I think the Court's
Erie
analysis is flawed. But in my view, one does not even reach the
Erie question in this case. The standard to be applied by a
district court in ruling on a motion for a new trial is set forth
in Rule 59 of the Federal Rules of Civil Procedure, which provides
that "[a] new trial may be granted ... for any of the reasons for
which new trials have heretofore been granted in
468
actions at law
in the courts of the United States."
(Emphasis added.) That is undeniably a federal standard.12 Federal
District Courts in the Second Circuit have interpreted that
standard to permit the granting of new trials where" 'it is quite
clear that the jury has reached a seriously erroneous result'" and
letting the verdict stand would result in a " 'miscarriage of
justice.'"
Koerner v.
Club Mediterranee, S.
A.,
supra, at 331 (quoting
Bevevino v.
Saydjari,
574 F.2d
676, 684 (CA2 1978)). Assuming (as we have no reason to
question) that this is a correct interpretation of what Rule 59
requires, it is undeniable that the Federal Rule is "'sufficiently
broad' to cause a 'direct collision' with the state law or,
implicitly, to 'control the issue' before the court, thereby
leaving no room for the operation of that law."
Burlington
Northern R. Co. v.
Woods, 480 U. S. 1, 4-5 (1987). It
is simply not possible to give controlling effect both to the
federal standard and the state standard in reviewing the jury's
award. That being so, the court has no choice but to apply the
Federal Rule, which is an exercise of what we have called
Congress's "power to regulate matters which, though falling within
the uncertain area between substance and procedure, are rationally
capable of classification as either,"
Hanna, 380 U. S., at
472.
***
There is no small irony in the Court's declaration today that
appellate review of refusals to grant new trials for error of fact
is "a control necessary and proper to the fair adminis-
12 I agree with the Court's entire progression of reasoning in
its footnote
22, ante, at 437, leading to the conclusion
that
state law must determine "[w]hether damages are
excessive." But the question whether damages are excessive is quite
separate from the question of when a jury award may be set aside
for excessiveness. See
supra, at 465. It is the latter that
is governed by Rule 59; as
Browning-Ferris said, district
courts are "to determine, by reference to
federal standards
developed under Rule 59, whether a new trial or remittitur
should be ordered," 492 U. S., at 279 (emphasis added).
469
tration of justice,"
ante, at 435. It is objection to
precisely that sort of "control" by federal appellate judges
that gave birth to the Reexamination Clause of the Seventh
Amendment. Alas, those who drew the Amendment, and the citizens who
approved it, did not envision an age in which the Constitution
means whatever this Court thinks it ought to mean-or indeed,
whatever the courts of appeals have recently thought it ought to
mean.
When there is added to the revision of the Seventh Amendment the
Court's precedent-setting disregard of Congress's instructions in
Rule 59, one must conclude that this is a bad day for the
Constitution's distinctive Article III courts in general, and for
the role of the jury in those courts in particular. I respectfully
dissent.
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